It all started after three men said they were robbed by three other men inside a taco restaurant in the 100-block of N Wabash Avenue just before 5:30 p.m., police said. The robbery victims then took out a firearm and began shooting at the alleged thieves.
Two men were unintentionally wounded after caught in the crossfire, police said.
WATCH: Police give update on shooting near Chicago Theater
"We had the people who were robbed took out a firearm and started discharging at the individuals who took something from them, and then we had two victims that, like I said, who were unintended targets in this," said Chief Brendan Deenihan with the Chicago Police Department.
Surveillance video from a nearby business shows people running down the street as the chaos unfolded.
"This was a shooting that started with a conflict and unattended victims: one shot in the hand and another shot in another part of the body."," said Chicago Police Superintendent David Brown.
Both were transported to Northwestern Hospital in fair or good condition.
One of the victim's father said his 55-year-old son works as a theater stagehand. He was on a break at the time he was shot in the ear.
The other victim, a 27-year-old man, was shot in the hand, police said.
"We are starting to see increases in areas where we normally don't see increases in shootings and homicides," Brown said. "People are resolving personal conflicts more with guns in this country than they have in the past."
Hours later, Sunday's night performance of "Moulin Rouge!" was abruptly canceled, eve as people packed into nearby Nederlander Theatre and just as the curtain was about to go up.
"Some gentleman came out, and was visibly quite upset and shaken, and apologized that they were going to have to cancel that nights performance due to security concerns earlier that day in the Loop," said audience member, Shannon Gritzenbach.
The Local 2 Chicago Stagehand Union, releasing a statement that said:
"The safety of our members is a priority, as is the safety of our community. We are communicating, collaborating and coordinating with Chicago police to maximize resources both public and private to keep our workers, the public and our downtown safe."
Chicago police said they will be deploying additional resources to the Theater District and work closely with the Cook County Sheriff's Office to enhance safety.
The incident marked at least the third shooting in downtown Chicago this weekend. Two women were shot, one killed near the House of Blues in River North Saturday; and a man was found shot to death in a Streeterville hotel Sunday morning.
"The West Side violence is as important to us as the South Side violence, as the downtown violence," Brown added. "It's all important to us."
So far this weekend, 32 people have been shot, 7 fatally in Chicago shootings.