Occupants of illegal structures in Hangberg on Monday opened fire on police and city staff, the City of Cape Town said.

Executive director Hans Smit said the city's Anti Land Invasion Unit supported by police were demolishing illegal structures that had gone up in the area at around 6:30am, when they were attacked.

"The City's Housing Directorate has been negotiating with the local community for two years around the in situ upgrading of the informal settlement that will result in 350 housing opportunities."

Smit said the project steering committee had been established but for it to proceed it was essential that the issue of the illegal structures be resolved.

"While the our members were demolishing the wall, community members called and asked that the operation stop. Gun shots were heard. As staff ran...they were stoned."

The city said flares started landing in between the staff members and further shots from 9mm pistols were discharged from the community.

All staff members were safe except for a policeman who sustained a bullet wound in the hand.

The city said this was the second attempt to demolish the illegal structures as staff had to withdraw previously after police advised it was dangerous.

Sapa