Darrius H. Kennedy, 51, was shot by two officers Saturday after he refused their order to drop a long kitchen knife he was waving at tourists, The New York Times reported.
When he got within 3 feet of the officers, they fired 12 shots, at least seven of them hitting Kennedy, police said.
Kelly said the number of shots fired was not unusual and that he felt "the police responded appropriately."
No one else was hit by the gunfire.
Officers had tried to subdue Kennedy six times with pepper spray, police said.
Vendors around Times Square knew Kennedy as "the ninja man," a reference to his proclivity for dressing in black from head to toe.
Police said Kennedy had been taken to Bellevue Hospital in October 2008 for a mental evaluation after he was found tipping over garbage cans at Times Square.
A month later he was charged with resisting arrest after threatening officers with a screwdriver as he harassed drivers on Broadway, police said.