UPDATED 8.00pm: Californian authorities have identified the shooting suspects killed in a shoot out with police in San Bernardino as 28-year-old Syed Farook, a male US born environmental specialist in the public health department and 27-year-old female Tashfeen Malik.

Chief Jarrod Burguan says it's not yet clear what their relationship was.

Confusion remains over what sparked today's mass shooting in California, which has left 14 people dead and 17 injured.

Wall Street Journal reporter Jim Carlton told Larry Williams the male suspect shot dead by police was a state employee, of Middle Eastern descent.

He says there are reports that earlier in the day the man had been at the party where the shooting took place, and had been in an altercation with someone there.

"But the fact that they were so heavily armed, and had these explosive devices, I think that's why we have Homeland Security, we have FBI, we have a major investigation, so I'm thinking they think it is more than a workplace dispute."

San Bernardino's mayor said the implications of today's shooting stretch beyond the Californian city.

Carey Davis is urging people to remain calm but also to stay alert - not just for the safety of San Bernardino.

"As we stand in the world today with those things that are taking place, all communities need to be on alert."

He's said it's important not to panic.

• Richard Arnold: San Bernadino shooting

"It's not a time for us to become angry, but yet to also realise that there is a need to be very cautious and in a state of high alert."

Police action continues:

Police action continues in the wake of a mass shooting in California.

CNN's Scott Glover is outside the apartment building in Redlands, California, where the FBI is carrying out a search following the shootings.

"There's been a heavy police presence out here for the last couple of hours, there's a large armoured SWAT vehicle, there are officers in military fatigues."

Meredith Davis, spokeswoman for the Bureau of Alcohol, Tobacco, Firearms and Explosives said ATF, FBI are running an explosives robot through the home, to make sure the scene is clear.

Neighbours have been asked to evacuate until they can confirm there are no explosives in the home.

Police in California earlier announced the two suspects dead after a gunbattle with officers in San Bernardino, are a man and a woman.

Police Chief Jarrod Burguan said they were "wearing assault style clothing" and were "both armed with assault rifles, both armed with handguns, and there was some sensitive stuff around the vehicle."

"We are taking a very cautious approach around the vehicle in case there is more sensitive stuff there."

Chief Jarrod Burguan said there is a third suspect in custody.

"There was a third person, that was seen running away, we do not know if they were involved, we have that person detained."

CNN"s Deborah Feyerick said the search for the perpetrators came to a head on a highway, not far from the original mass shootings.

"As police were chasing the vehicle, items were being thrown from the window, including what appears to be pipe bombs. Those are being looked at closely right now."

Deborah Feyerick said the officer who engaged the suspects, and is now wounded, is being questioned to try to determine exactly how many people were in the SUV.

"Clearly police are trying to make sure noone else is out there and on the loose - that's really what they're engaged in right now."

Earlier this morning gunmen opened fire on a holiday party at a social services agency in San Bernardino, California, killing 14 people and wounding 17 others before fleeing.

As an intense manhunt for up to three suspects ensued, San Bernardino police reported one "suspect down" in an exchange of gunfire with officers but did not immediately confirm whether the individual was connected to the shooting.

The shooting rampage at the Inland Regional Center about 100km east of Los Angeles marked the deadliest US gun violence since the massacre at Sandy Hook Elementary School in Newtown, Connecticut, in December 2012, in which 27 people, including the gunman, were killed.

San Bernardino Police Chief Jarrod Burguan said in a televised news briefing three hours after Wednesday's shooting that the suspects were believed to have made their getaway in a dark-coloured sport utility vehicle.

A vehicle matching that description turned up at the shootout with police several hours later, city police spokeswoman Sergeant Vicki Cervantes.

LISTEN: Los Angeles correspondent Richard Arnold speaks with Leighton Smith 

One police officer was wounded in the confrontation and is being treated in hospital.

"Somehow during that contact shots were exchanged between the suspects and the officers. One officer was injured," a spokeswoman told reporters.

"However he was transported to a local hospital and it does not appear to be a life threatening injury."

She said the incident was "still very active".

Earlier police reported an "unknown number of shots" were fired at the Waterman Discount Mall, close to the scene of the original shooting, where a man was spotted wearing military fatigues in the area.

Another wearing a headset, tactical shorts and a backpack has also been spotted.

Police officers immediately began pursuing the SUV, and moved towards the Cornerstone Assembly of God church. There are reports police who were at the church now appear to have begun to stand down and are moving south. 

Mr Moya said officers are checking out every corner of a suburb, and the heightened state of alert is constantly fluctuating.

At least 14 dead and 17 wounded in mass shooting

Gunmen opened fire on a holiday party at a social services agency in San Bernardino, California, killing 14 people and wounding 17 others before fleeing.

It's understood up to three shooters - described as Caucasian - stormed the facility wearing military clothing and ski masks.

Burguan said he knew no possible motive behind the attack, which unfolded at about 11am local time (8am Thursday NZ time) at the Inland Regional Center, about an hour east of Los Angeles.

"We have no information at this point that this is terrorist-related, in the traditional sense that people may be thinking," he added.

"Obviously, at minimum, we have a domestic-type terrorist-type situation that occurred here."

He said the suspects were armed with rifles.

Heavily armed SWAT teams, firefighters and ambulances swarmed the scene, as police warned residents away.

With suspects at large, authorities ordered a security "lockdown" of all local schools, as well as city and county buildings, and area hospitals were placed on alert, Burguan said.

"We don't have any information or any credible threats to any other facilities at this point but obviously we are all on a heightened sense of alert," Chief Burguan said.

The local Sheriff's department are urging the public for any information they may have on the suspects.

The public can call 1 866 346 7632 if they have any information or leads on the #ActiveShooter incident in #SanBernadino @SanBernardinoPD

— SB County Sheriff (@sbcountysheriff) December 2, 2015

The shooting unfolded on the campus of the Inland Regional Center, one of 21 facilities set up by the state and run under contract by non-profit organisations to serve people with developmental disabilities, said Nancy Lungren, spokeswoman for the California Department of Developmental Services.

Lavinia Johnson, executive director of the facility, told CNN the suspects opened fire inside a conference building in the complex where a holiday party was being held for county health department personnel.

So far in 2015, there have been more than 350 shootings in which four or more people died, according to the crowd-sourced website shootingtracker.com, which keeps a running tally of mass shootings.

Bomb technicians are checking suspect items in the building

A police spokeswoman told the Los Angeles Times that the suspects were heavily armed and possibly wearing body armour, and CBS reported that a bomb squad was on the scene, trying to defuse what was believed to be an explosive device.

CNN's Deborah Feyerick reports the left behind a package that's currently being investigated by the squad.

"They're going to x-ray the package or try to get the package, but right now the words that I'm being told is that it has not been disrupted yet, that they don't know what it is and that they're still handling the situation." 

Local police are warning residents to stay away from the area.

"They're heavily armed and they're possibly wearing body armour, things of that nature. It is not a safe area to be, it's very dangerous and the fewer innocent people we have in here the better."

Please help Law Enforcement and stay clear of the area

— San Bernardino PD (@SanBernardinoPD) December 2, 2015

San Bernardino is about 10 km east of Los Angeles.

Confusion and chaos as safety cordons put in place

The Inland Regional Center is one of 21 facilities serving people with developmental disabilities run by the state, said Nancy Lungren, spokeswoman for the California Department of Developmental Services.

Triage units were set up outside the building, and people were seen being wheeled away on stretchers.

Others walked quickly from a building with their hands up.

They were searched by police before being reunited with loved ones.

Police and SWAT teams were seen surrounding the building.

A police spokeswoman told the Los Angeles Times that the suspects were heavily armed and possibly wearing body armour.

"Area remains VERY ACTIVE. AVOID!" tweeted the local sheriff department, which confirmed there were "multiple victims."

ACTIVE SHOOTER:Area of Orange Show Rd/ Waterman Ave near Park Center, & surrounding area remains VERY ACTIVE. AVOID! pic.twitter.com/5vG0aYW6IL

— SB County Sheriff (@sbcountysheriff) December 2, 2015

The situation is confused and people in the area are terrified.

Brandon Hunt works at the Inland Regional Centre which is inside the cordon, but had left for a break when the shooting started.

He said there were about 550 employees inside the building and 100 people were at a banquet inside at the time, most of whom have now managed to get out.  

He expressed his shock at the fact a centre disabilities and special needs would be the target of an attack.

"These people give their heart and soul to this agency just to help other people and the audacity of people to come out here and just want to shoot it up is insane."

Witnesses report people being carried out on stretchers.

One man reports his wife was inside the building when the shooter opened fire.

"They were barricaded in their office and heard a lot of gunshots, crying when SWAT got her out and escorted her out of her office. She said that there were bodies they had to go through to get out. She doesn't know whether they were deceased or whether they had just been shot but she said a lot of shooting."

Paul Lacirox has spoken to his son who works at the facility, who has managed to escape unharmed.

"There were three shooters in there. Supposedly they found a package that they believe that might be a bomb so they're investigating that right now. I heard that there were multiple wounded and multiple fatalities."

Shooting a domestic terror situation

FBI David Bowditch told the press conference they could not say yet if the San Bernardino shooting was terror-related.

"We start with the beginning, working with our local partners," he said.

"We take the presumption that it may be, it may not be, but we will work hand in hand with them from the beginning."

Police Department Chief Jarrod Burguan said the motive for the shooting is unclear, but the three gunmen came with a purpose.

"The information we have is that they came prepared to do what they did as if they were on a mission."

When asked if any threats had been made prior to the incident, Chief Burguan said "I am not going to talk about that right now."

CNN's Evan Perez reports this is different to other mass shootings.

"To have more than one shooter really puts it in a different category where we have to start thinking whether or not there might be some type of terrorist angle here, there may be thinking about whether or not some type of conspiracy may have been involved with multiple people carrying out this attack."

CNN law enforcement analyst Tom Fuentes suspects the mass shooting in California is a domestic attack on the US government, not an international terror attack.

He believes the information we know at this points about the shooters signals more a domestic anti-Government militia group, than international terrorists who usually carry out suicide missions.

"It's separate because of the multiple people that it would be hard to have three psychotic individuals simultaneously coordinate this attack like you have in many of these other shooting situations."

Obama: 'Pattern of mass shootings in US unlike anywhere else in the world'

JUST IN: @POTUS responds to San Bernardino shooting, speaking with @NorahODonnell https://t.co/vyA7XqpSB3 https://t.co/C3t6swG6gD

— CBS This Morning (@CBSThisMorning) December 2, 2015

Barack Obama has been briefed.

"We don't know that much yet. I's still an active situation, FBI is on the ground offering assistance to local officials if they need it."

And he spoke again about the need for stricter gun control - saying there's a pattern of mass shootings in the United States that has no parallel anywhere else in the world.

"There are some steps we could take, not to eliminate everyone of these mass shootings, but to improve the odds that they don't happen as frequently."

Obama said he would be taking action following these shootings. 

"We don't yet know what the motives of the shooters are, but what we do know is there are steps we can take to make Americans safer and that we should come together in a bipartisan basis at every level of Government to make these rare as opposed to normal," Obama told CBS News.

"We should never think that this is something that just happens in the ordinary course of events, because it doesn't happen with the same frequency in other countries," he said.

Democratic presidential candidate Hillary Clinton said on Twitter, "I refuse to accept this as normal. We must take action to stop gun violence now".

I refuse to accept this as normal. We must take action to stop gun violence now. -H https://t.co/SkKglwQycb

— Hillary Clinton (@HillaryClinton) December 2, 2015