The Los Angeles Police Department said the suspect, who has not yet been identified, robbed an AutoZone auto parts store near the busy intersection of Sunset Boulevard and Highland Avenue in Hollywood.
"He walks in and goes over to the batteries and he grabs one, and he walks over to the door and he slams it on the ground and pulls out the machete and he threatens and swings it at us," AutoZone employee Juan Chaidez told KTLA. "Then he grabbed the battery and runs away."
The suspect then walked over to a nearby Chick-fil-A and allegedly began threatening customers before he carjacked a male driver in the drive-thru, the station reported, citing witnesses.
"As he's running with the machete, he's pretty much got the cops chasing [him] down," witness Clinton Gunnels said. "They kind of gave him a second to surrender, but he hijacked a car and then the driver hops out of the car, and that's when he hopped over to the driver's seat and that's when he drove off."
In a media briefing posted on Twitter police described the machete as a foot to a foot-and-a-half long.
KTLA reported that video taken by a witness showed the suspect driving away in the customer's black car, stopping a short distance from the drive-thru, then crashing into two LAPD vehicles. The footage then reportedly showed the man getting out of the car at the intersection and running away from officers while holding the machete.
Officers gave the suspect several commands to drop the weapon and used less-lethal options, Fox 11 reported.
The man did not comply and was shot by an officer shortly thereafter, police said, adding that he was rushed to an area hospital where he was pronounced dead.
Police said one officer sustained minor injuries to his elbow and knee. He was treated at the scene.
The witnesses who took cell phone videos reportedly were asked to turn their footage over to the police. The investigation is ongoing.