Two people remain inside the house where police have been responding to a family harm incident and a local resident says the situation appears far from over.
Armed police have been at Motueka Street since this morning after they were called to a family harm episode.
The situation sparked lockdowns at several neighbouring schools.
A resident who lived on Motueka Street told RNZ they were unable step outside their property.
The person, who did not wanted to be named, said they were several houses down the street from the property in question.
He said the situation felt far from over.
"I was outside having a vape before, and I was hiding behind the tree and I could overhear the cops saying it wasn't going to be over anytime soon,
"It could go on for a little bit... my kids are a bit worried."
It is understood some residents have had to stay in motel accommodation for the night because they were not allowed back in their home.
'I've seen one person go into their property, grab some clothing and leave again.
"My neighbour wants to come home and have a shower, they can't even do that, and they're in a back house.
"I was lucky I managed to get home, compared to anyone else on the street. "
AOS members had also been spotted circling some neighbouring properties, he said.
The resident said the neighbourhood was "very quiet",
"You can almost hear a pin drop.
"It's just very still, it feels like two or three in the morning, kind of like Covid lockdown."
Tasman district commander Superintendent Tracey Thompson said emergency services were called to the address on Motueka Street at 10.15am.
There were four people inside the house of the time, two have since left uninjured though Thompson said one was transported to hospital to be examined.
"A significant police resource has been deployed to the incident, including the Armed Offenders Squad and the police negotiation team."
Lockdowns at five Nelson schools were lifted at about 3pm and Thompson said they went into lockdown as a precuation, along with Nelson Hospital.
"The cordoned area has been reduced to enable entrance to Nelson Hospital for those who need to access the hospital, and to allow 'residents only' access to some streets."
St John has been placed on standby and an ambulance, rapid response vehicle and a manager have been sent.
"We know that this will have been an incredibly unsettling event and we want to reassure the community that we are doing all we can to bring the matter to a peaceful conclusion," Thompson.
Victory Primary School told RNZ went into lockdown about 10:30am.
Nelson Intermediate School, Nelson College and Hampden Street School also went in lockdown.
The lockdowns were lifted to allow students to leave at the end of the school day.
In a statement Health NZ said Nelson Hospital has been placed in partial lockdown restricted to card access only.
"Visitors and patients are able to access the hospital via the main entrances which are staffed with security personnel to allow that access."
Near the scene Artistic Beauty Salon owner Karen told RNZ what she could see on Monday morning.
"Well I have been able to hear an alarm go off for about 10-15 minutes, and I have come out onto the roadside and up by the hospital between Franklin Street and Motueka Street.
"We've got two cop cars blocking the road and down the end of the street heading towards Vanguard. Up Vanguard Street we've got another police car blocking the road there and we have another undercover cop car with some police holding a gun," she said.
Nelson City Council said the incident was causing traffic delays on Waimea Road and surrounding areas.
The eBus route 3 was being diverted away from Motueka Street and Franklyn Street, it said, and this would likely cause delays on the route for the rest of the day.