A shot was fired after a crash between two cars in a residential road.
The driver of a BMW discharged a firearm before escaping in a Mercedes following a crash with a Renault, police said.
They said nobody was hurt in the incident at 15:30 GMT on Thursday in Burdock Drive, Laindon, Essex.
Essex Police is searching for the man reported to have the firearm. The other driver has been spoken to by police.
Det Ch Insp Paul Lopez said: "We are in the process of establishing the circumstances of how a Renault and BMW came to be in collision in Burdock Drive.
"Our team of detectives are working hard to locate the man who was reported to have been seen in possession of the firearm.
"The Mercedes has been located and forensically recovered."
One eyewitness, who did not want to be named, said she was on the way home from the school run when it happened.
She said: "I pulled up seeing [the] car smashed in the middle of road and the armed police overtook my vehicle... The police advised everyone to return to inside their properties."