Gunman worked for the same firm as the American victim and was recently sacked for drug-related issues, officials confirmed
A gunman killed a US national and wounded another in the Saudi capital of Riyadh on Tuesday, officials said, heightening Western concerns over security in the world's top oil exporter as regional unrest rises.
Police later shot and wounded an assailant and then arrested him, police said, adding there was no proven information of any ties between the man and "extremist" groups.
The apprehended man worked at the same company as the two victims and had recently been dismissed from his job, Saudi Arabia's embassy in Washington said in a statement.
"The attack resulted in the killing of one person and wounding another and it turned out they were of American citizenship," a police statement carried by state media said.
Interior Ministry spokesman Major General Mansour Turki said an investigation was under way into what appeared to be the first killing in years of a Westerner in Saudi Arabia.
"Security authorities have no proven prior links between him and extremist organisations but they are following his health condition in order to take his statement," a ministry statement said.
The Saudi Embassy statement identified the arrested man as Abdulaziz Fahad Abdulaziz Alrashid, a dual Saudi-American citizen who was born in Washington state in July 1990.
"Alrashid worked at the same company as the victims, and was recently dismissed from his job due to drug-related issues," the statement said.
Alrashid's family could not immediately be reached for comment.
The Americans worked for Vinnell Arabia, a local affiliate of US defence company Northrop Grumman Corporation which provides training and support services to the Saudi Arabian National Guard, said US State Department spokeswoman Jen Psaki.
"We can confirm that two US citizen employees from Vinnell Arabia, a US defence contractor supporting Saudi National Guard military programmes in Riyadh, were shot at a local gas station/store approximately 0.5 miles from the Vinnell Arabia base in Riyadh, which is located approximately 20 miles from the US Embassy," Psaki said.
Psaki added that the US government was evaluating its security and would take steps to ensure the safety of all US mission personnel.
With tensions in the region heightened because of conflicts in Syria and Iraq, and with Saudi officials concerned about rising domestic militancy, security at Western compounds is being stepped up.
"We will be heightening security around our compound," said the manager of a Western residential compound in Riyadh.
Most security at Western compounds has been provided by the Saudi Arabian National Guard since a string of attacks on foreign targets a decade ago.
Police said Tuesday's attack occurred when the two Americans stopped their vehicle at a filling station in an eastern district of the capital. Turki said a third US national in a different vehicle witnessed the attack.
"That area would be on my way to work and I'm in that area often, stopping at local shops and buying things. I might avoid stopping there for a while," said a US national who lives in Riyadh.
An Italian working in the oil industry in Saudi Arabia said: "The targets are Americans, not really any others, so I'm not too concerned. But I did think about posting a few bumper stickers with the Saudi flag and Allah Akbar (God is Great) on my car."
Saudi officials have said this year they are concerned about a rise in domestic Islamist militancy due to the conflicts in Iraq and Syria. The government has decreed tough penalties for terrorist crimes.
The last reported killings of Westerners by armed assailants in Saudi Arabia happened in 2007, when three French nationals were shot dead while camping in the northwest of the country.
A group of men accused of being a part of Al Qaeda are on trial in Riyadh for those killings and are awaiting a verdict.
From 2003 to 2006, Al Qaeda carried out a series of attacks on foreign and government targets, killing hundreds before being crushed by Saudi security forces.
Contractor Vinnell's compound in Riyadh was among those struck in a day of deadly bombings in May 2003.