The operation involving scores of armed officers took place in the neighbourhood of Neudorf, where the gunman was last seen.
Part of the neighbourhood which lies around 2km from the centre and 5km from the German border, has been cordoned off as specialist Swat teams move in. Residents have been asked to leave the area inside the cordon.
However police have not confirmed the operation is linked to the hunt for Cherif Chekatt.
A huge manhunt continued in France and Germany on Thursday to track down Chekatt, the man authorities believe was behind the deadly terror attack in the centre of Strasbourg on Tuesday evening.
The attack took place Tuesday night around 8 pm (1900 GMT) in the heart of the medieval city as the market was closing.
Witnesses said the suspect, a 29-year-old Strasbourg native cried “Allahu Akbar” as he opened fire with a handgun and stabbed passers-by. On Thursday morning the French government confirmed that a third person had died as a result of the attack.
The toll now stands at 13 injured, with five still in critical condition, as hundreds of police search for the fugitive gunman, the prefecture said in a statement.
On Wednesday evening, with Chekatt still at large, French police issued a public appeal for help in hunting down the gunman. On a photograph released by French authorities the suspect has dark eyes, black hair and a short beard.
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Members of the public are warned not to approach “the dangerous individual” but to alert authorities by contacting the emergency number 197.