Investigators said the man, identified as Daniel Abeyta, set the booby traps in a street near his home, The Denver Post reported. Police said they found a hand grenade and propane tanks covered with gunpowder.
"They are somewhat a booby trap, so his intent was to harm," Denver Police Chief Robert White said. "As officers approached, he actually shot one of the tanks."
The officers opened fire, leaving Abeyta, who faces a first-degree murder charge, in critical condition in Denver General Hospital Friday afternoon.
Police responded to the quiet residential neighborhood after getting a report of a man with a gun Friday morning. White said a woman was found dead in her house, and the injured woman was on a porch with a bullet wound in her leg.
The identities of the two women had not been released, and White did not say whether they had any relationship with Abeyta.
Melissa Allen, who lives nearby, said her 18-year-old daughter called her Friday morning, saying she had heard a violent argument from a nearby house and had seen the homeowner with propane tanks. Allen said she told her daughter to hide in a back room with her younger brother.
Allen said she had known the shooter for three years.
"He seemed like a nice person," Allen said. "He was always with his kids outside."