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The city of Watertown, Mass., has been effectively shut down as a manhunt is underway for the second suspect in the Boston Marathon bombing.

Residents were awakened overnight by heavy police presence and a dramatic shootout in Watertown that ended with the death of one of the Boston marathon bombing suspects while the second is still on the loose.

Officials say the suspects had hijacked a car in Cambridge, Mass., and drove to Watertown while being pursued by police.

Authorities used a news conference, robo-calls and Twitter to tell residents to shelter in place.

"Residents of Watertown asked to stay indoors," the Boston Police Department tweeted. "Do not answer door unless instructed by a police officer."

Public transportation has been suspended and authorities told people at closed stops and stations to go home. No vehicle traffic is allowed in Watertown. A no-fly zone is in place over the city.

"We are asking you to stay home, stay indoors," police said at a news conference this morning. "We are asking businesses not to open. We are asking people not to congregate outside. We're asking people not to go to mass transit."

Watertown is about eight miles west of Boston and has a population of about 32,000.

Public safety officials have also advised residents in nearby Waltham, Belmont, Newton, Cambridge, Allston and Brighton to remain indoors, asking businesses to remain closed.

The at-large suspect is considered armed and extremely dangerous. Police are going door to door in search for the second suspect.

"We believe this is a terrorist, we believe this is a man that's come here to kill people," Boston Police Commissioner Ed Davis said.

"When I started hearing the gunshots and the explosion, given what had happened at MIT and seeing all the police cars rushing to Watertown past my house and hearing all the sirens, I felt very strongly that it was related to events earlier this week," Dr. David Schoenfeld of Beth Israel Hospital said at a news conference.

Doctors at the hospital treated the patient believed to be bombing suspect 1 who died at the hospital from a combination of blast and gunshot wounds. He came to the hospital under police guard. He was pronounced dead at 1:35 a.m.

The hospital has not specifically said the deceased is the bombing suspect.