One of Joaquin "El Chapo" Guzman's sons has been released by security forces, after they were surrounded by heavily armed cartel fighters.
Ovidio Guzman, who is accused of drug trafficking in the US, was one of four people discovered by the National Guard inside a house in the Mexican city of Culiacan.
But officials say the police then came under attack, and decision was made to retreat from the scene to protect lives.
Gangsters had set up roadblocks and were unleashing heavy automatic gunfire in the area, which has long been a stronghold for the Guzmans' Sinaloa cartel.
The country's Security Minister Alfonso Durazo said: "The decision was taken to retreat from the house, without Guzman to try to avoid more violence in the area and preserve the lives of our personnel and recover calm in the city."
According to the minister, around 30 members of the National Guard were fired at from a house containing the drug baron's son.
'El Chapo' was jailed in July for his decades-long career of drug smuggling in central and north America.
The 62-year-old was sentenced to life plus 30 years at a supermax prison, where he is expected to die before he is released.
It is thought that Ovidio, along with his brothers, are still influential figures in the Sinaloa cartel, despite their father being imprisoned.
Ovidio is on a number of wanted lists due to his links with the drug cartel, according to local media.
Guzman's drugs cartel is believed to now be led by Ismael "El Mayo" Zambada alongside El Chapo's sons - and have all been accused of distributing drugs such as cocaine, methamphetamine and marijuana.
News of Guzman's potential arrest triggered more gun fights in the city between security forces and "heavily armed civilians", with stand-offs reportedly lasting several hours.
Riodice, a news service based in the city, said that armed security forces were heavily deployed after gunmen blocked entrances to the city with burning vehicles.
It also reports that the army were involved in the stand-off.
Cartel gunmen were reportedly driving around the city in trucks, with one armed with a mounted machine gun, while locals hid in supermarket aisles and took cover in the streets.
Police confirmed that, as a result of the fighting, several inmates escaped from a local prison. Some were later recaptured.
Locals were told to stay inside by the local governor, who also cancelled school classes for the day, amid the security concerns.
No deaths were reported by local police, but officials failed to rule out that some people may have died.