Armed police arrived in Buttington Road, Monkmoor, at around 8.40pm, blocking off an alleyway near Vennington Walk. A police helicopter circled above while residents were told to stay indoors.
It was not clear why armed officers arrived, and concerned neighbours were out in the street, talking to one another to try and piece together what might be happening as more police arrived.
At around 10pm, several police cars, marked and unmarked, arrived at a business on Monkmoor Industrial Estate, off Monkmoor Road, before armed officers entered, shouting: "Armed police, get down!" Most officers left the site around 20-25 minutes later, with one police car remaining at the site.
West Mercia Police confirmed on Saturday morning that officers were responding to reports of a man armed with a knife.
A spokesman said: "The man was located by officers around 11.10pm and taken into custody where he remains."
At the other end of Monkmoor Road, the Abbey Foregate end near Tim Tim takeaway, a collision happened between a police car and a blue Kia Cee'd.
Chen Xiong, manager of the takeaway, said he heard a loud noise from the kitchen at around 10.30pm. "I heard a loud bang," he said.
"It looked like a big crash. I don't think anyone was hurt but I don't know." He said it appeared that police took two people from the scene. It is not clear whether the crash is related to the activity at the other end of Monkmoor Road. The road remained open to traffic.
Bob Griffiths saw the scene of the crash on his way home. He said: "A blue car looks like it had collided with a police car or vice/versa. The police car was severely damaged. The front corner of the blue car was also badly damaged.
"There were no ambulances and a number of people were talking to the police on the side of the road." He also said police were seen searching the grounds of Severndale School in Woodcote Way, with dogs.
Police said on social media that there was an incident involving the deployment of a helicopter in Shrewsbury, but there had been no reports of anyone injured or assaulted. The force also said it was dealing with an incident at McDonald's in Battlefield Road.
A statement said: "This evening, officers have been responding to what we believe to be an isolated and contained incident at McDonald's in Battlefield Road, Shrewsbury.
"We are also in attendance to a separate and unrelated incident nearby where we have also deployed the NPAS helicopter to support officers.
"We would like to reassure the local community that we have received no reports of anyone injured or assaulted."
West Mercia Police has been contacted for further detail.