Rio Mais, the consortium building the Olympic venues, confirmed that random gunshots were fired as workers and security confronted each other. There were no reports of injuries. Spokespeople for both Rio Mais and the Rio Olympic organizing committee said they were investigating the incident.
The work stoppage involving more than 2,000 workers began Thursday, and Rio Mais said it was unclear when work would resume.
The dispute center around which union represents the construction workers, and also involves benefits and working conditions.
The strike is sure to capture the attention of the International Olympic Committee executive board, which is meeting this week in the Turkish Mediterranean resort of Belek.
A team of IOC inspectors visiting Rio almost three weeks ago, headed by Olympic hurdle champion Nawal El Moutawakel, said the games faced "challenging deadlines."
IOC President Thomas Bach has repeated often that Rio "doesn't have a day to lose," and some fear it could face chronic delays similar to those hitting the upcoming World Cup.
The strike adds to a growing list of problems confronting Rio organizers with the games just over two years away.
Construction on the second largest cluster of venues in northern Rio de Janeiro, in an area called Deodoro, has yet to begin. Work on the Olympic golf course has also been delayed.
Severe water pollution in Rio's Guanabara Bay, the venue for Olympic sailing, is a growing concern with a test event scheduled there in August. IOC officials have said they will not risk the athletes' health if the water is unsafe.
Many of the delays are rooted in disputes among Brazil's three levels of government over who pays for what. Most estimates suggest Brazil will spend about $15 billion on the Olympics, a mix of public and private money.