Four of Mayor Luis Biels escorts a policeman, a female security guard and two civilian personnel who came to his rescue were wounded in the shootout.
Senior Police Inspector William Gadayan, the citys police chief, said Biel was in the motorpool of City Hall when the assassin, armed with a caliber .38 pistol, approached from behind and shot him at about 12:30 p.m.
Biel, who sustained a single bullet wound, was rushed to the nearby Infante Hospital but died an hour later.
"The assassin appeared daring and suicidal and was not carrying any identification," Gadayan said.
He said they were looking into all angles in the killing.
Provincial spokesman Cris Puno said Biels gunslaying has brought horror to the islands capital which, for four years now, has been experiencing peace and development, thanks to a US-backed military offensive that has flushed out the Abu Sayyaf.
Gadayan said they cannot tell if Biel was killed because of his order to demolish a mosque reportedly squatting on a city government property.
Gadayan said they were not also ruling out the possibility that the Abu Sayyaf might have a hand in the attack.
Vice Mayor Rodolfo Tan took over the mayorship by virtue of succession, and the mayors son, Luis VI, the number one councilor, became vice mayor.