The shooting happened close to the corner of Letterman and Armistead Streets, near military housing, around 3:30 p.m. Thursday during a unit safety brief.
The shooter was injured and was taken into custody.
A third soldier who was wounded during the shooting is out of the hospital. Officials say 22-year-old Spc. Michael E. Latham of Vacaville, Calif., has been released from Womack Army Medical Center. Latham suffered what's called a minor, non-life-threatening wound.
"This is a tragedy for our community. We don't yet know the reasons for the shooting, but are working with the unit and the affected families to help them through this difficult period," said Col. Kevin Arata, XVIII Airborne Corps and Fort Bragg Public Affairs Officer. "Our prayers are with those who have been affected by this terrible incident."
Fort Bragg officials have not released the identities of the officer killed or the shooter, or a motive for Thursday's shooting.
Sources said the dead man was the soldier's commanding officer and the alleged shooter was in the process of being court martialed.
Special agents from the Army Criminal Investigation Command are investigating. Officials are not saying what triggered the shooting or what kind of weapon was used.
Sources said the dead officer was shot five times and that the gunman is in grave medical condition at an unknown hospital.
Officials haven't said yet if any additional counseling will be available for the soldiers when they return from a four day holiday on Tuesday.
Fort Bragg is home to the 82nd Airborne Division, the 18th Airborne Corps and Special Operations Forces.