Two people were stabbed in the middle of Georgetown's bustling bar and shopping district last night while someone brandished a shotgun and frightened bystanders fled for safety.

One of the wounded men was taken to a hospital after the tumultuous incident in the 3100 block of M Street NW, and the second was treated at the scene, authorities said.

With as many as 1,000 people at or near the scene, according to police estimates, officers swarmed into the area, two blocks of M Street were closed to traffic, a helicopter hovered above and bystanders pressed up against strands of yellow police tape.

According to police, the incident started shortly before 9 p.m. with a dispute between a pedestrian and four people in a car on M Street.

At one point, one of the four got out of the car with a shotgun, while the pedestrian produced a box cutter. One man from the car was slashed in the chest and shoulder. He was reported hospitalized last night in serious but stable condition.

Another of the car's occupants was cut on the head. Police said late last night that they were interviewing him and the two other occupants, along with other witnesses. They said they found a shotgun and were trying to find the man with the box cutter.

Bill Starrels, a Georgetown area advisory neighborhood commissioner, said he was glad that police arrived quickly. "If you shoot a shotgun, you're going to hit more than your intended target," he said.

Steve Feldman, owner of Potomac Wine and Spirits on M Street, said: "A woman came running into my store . . . frantic and panicky." He said store personnel locked the front door and tried to calm her.

Inside the Mie N Yu restaurant on M Street, hostess Amalia Holl said she spotted a man running past her window with a shotgun.

She said patrons' reactions fell into three categories. Some appeared worried, "some ducked," and others "were just like, 'Uh, we're used to it.' " In all, she said, "it was a big ruckus."