Three people at the suspect's home have been taken into custody for questioning, according to interior ministry spokesperson Pierre Henry Brandet, although French officials haven’t released the gunman's name.
The Paris prosecutor’s office said in a press conference that the gunman was known to authorities, but not on a watch list.
The shooter used an automatic weapon to target a police van killing one officer and wounding two others at around 9 p.m. local time on Thursday on the famous and upscale Champs Elyees avenue, according to the French news agency AFP.
"I heard shots and I went to see what it was. I saw two bodies on the ground and people screaming, running everywhere," said Mehdi, a communications consultant, who AFP interviewed after the attack. "I was afraid. I left. I didn't even pay the bill!"
Police then returned fire, killing the suspect just a few hundred meters from the Arc de Triomphe, one of the most famous monuments where the city’s 12 radiating avenues converge.
The killer was a 39-year-old French man, according to France 24 news, which added he had been sentenced in February 2005 to 15 years in prison on three counts of attempted murder.
He was arrested in February on suspicion of plotting to kill officers, but released because of a lack of evidence, according to AFP.
The Associated Press has reported the man lived in the east Paris suburb of Chelles.
The ISIS propaganda website stated the attacker was an ISIS fighter, claiming he went by the moniker “The Belgian.”
Belgian officials disputed that.
"The guy who yesterday did the act was not a Belgian. He was a French. Now, if there are any links with the Belgian foreign fighters or something, is under investigation for the moment by our federal prosecutor and the French. And there will be a communication later on this morning," said Jan Jambon, the Belgian Interior Minister on Friday afternoon.
"Is certainly not the guy who committed the crime yesterday, certainly not. It is confirmed by the French that they know who it is and they took the finger prints and they confirmed it is a French guy from the neighbourhood from Paris," he added.
President Francois Hollande said in an address that the attack as "terrorist in nature."
The Paris prosecutor said his office had opened a terrorism investigation.
It is the third deadly attack against French security this year.
A man used a machete to attack four soldiers on patrol at the Louvre Museum on February 3.
At Paris' Orly airport a 39-year-old man was killed on March 18 after attacking a soldier.
The people of France will go to the polls on Sunday for the first round of presidential voting. Eleven candidates were appearing on a television program including front-runners: the conservative Francois Fillon, the far-right Marin Le Pen, centrist Emmanuel Macron, and socialist Benoit Hamon.
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