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Hospital officials confirmed two people had been killed in the attack and said at least 24 more were being treated for gunshot wounds.
A hospital spokeswoman said 14 of the victims were in a critical condition.
Police say "one suspect is down"but the investigation remains active and have warned people to stay away from the area.
Officers raced to the scene after receiving reports of an “active shooter” in the world famous Strip which is popular with tourists from all over the world.
According to witnesses, gunmen opened fire on revellers at the music festival.
There were scenes of chaos when the crowd of around 40,000 people tried to run for cover.