Two people were killed and over a dozen injured in a shooting outside a beer garden in Austin, Texas, in an incident the FBI says may be related to terrorism.

The suspect has been identified as Ndiaga Diagne, a naturalised American citizen born in Senegal, according to the BBC’s US partner CBS News and other US media.

Police said after responding to calls of an active shooter at around 02:00 local time near Buford’s bar in the southern US state’s capital, and killed the suspect, bringing the death toll to three.

Police have not offered a motive and have not officially identified Diagne. Of the survivors, 14 were taken to hospital, three in a critical condition.

Two sources familiar with the investigation told newsmen that the gunman was wearing a sweatshirt with the words ‘Property of Allah’.

Austin Police Chief, Lisa Davis said officers who were on patrol in the more popular, crowded bar district known as East Sixth Street quickly responded to reports of a man with a gun at Buford’s, located farther down on West Sixth Street.

She said a man in a large SUV driving by Buford’s put on the vehicle’s hazard lights, rolled down his window and fired a pistol, striking people on the patio and pavement outside the bar.

He parked the vehicle nearby, got out with a rifle and started walking back towards the bar, according to Davis. Three police officers confronted the suspect at an intersection, and shot and killed him.

The SUV was searched and was not carrying explosives, officials said.

However, Acting Special Agent in Charge Alex Doran, from the FBI’s San Antonio office, said there were indications in the SUV and on the suspect that suggested a “nexus to terrorism”.

But Doran said the investigation was in its early stages and he was “not prepared to release those details”.

“We are committed to seeing this process through to the very end,” he said.

Kelson Lee, 25, was within earshot when gunfire erupted at Buford’s. He walked inside to look for a friend, according to the Austin Current.

“I see about seven to eight bodies on the floor,” Lee told the local news outlet. “No-one should ever have to see that.