The incident follows a series of fatal shootings by officers that has revived debate over their use of force.
A patrol of four officers spotted the car, which had been reported stolen, in a parking lot in Venissieux, a suburb of the southeastern city of Lyon, just after midnight.
As they were about to check the occupants’ identity, the driver suddenly tried to flee, hitting an officer who was thrown onto the vehicle’s bonnet
He and another officer then fired several shots, prosecutors said, and when the car stopped moving, the patrol found two occupants with serious injuries.
The passenger died at the scene and the driver was hospitalised, and a police source said doctors declared him brain-dead.
The officers who opened fire were being questioned by the police’s internal investigations agency, a routine practice when officers use their weapons in the course of duty.
Police violence has been in the spotlight after several fatal shootings by officers, which critics see as a systemic use of excessive force and heavy-handed tactics by French security forces.
This month, police officers shot and killed a knife-wielding man, later identified as homeless, at the Charles de Gaulle airport outside Paris.
In June, police shot a woman dead in a car in northern Paris after the vehicle failed to stop when summoned by officers and then allegedly drove towards them at speed.
In April, prosecutors charged a 24-year-old officer with involuntary manslaughter after he used his assault rifle to shoot at a car that sought to escape a patrol in Paris, killing the driver and injuring a passenger.
And last March, angry residents clashed with police during several tense nights in the suburbs north of Paris to protest a fatal shooting by an officer against a van that had been reported stolen.
Under French law, the only justification for an officer using a weapon is when his or her life is in danger.
Particularly contested are patrols carrying assault rifles, which authorities began issuing after mass killings by jihadists in Paris on November 13th, 2015, and a subsequent wave of deadly Islamist attacks.
The government has vowed to take action to restore confidence in security forces, and the divisive issues of police violence and crime were brought to the fore in France’s presidential election this year.
Police unions say officers often face hostility and attacks, and are faced with the difficult task of trying to maintain order in impoverished high-rise housing estates that in some cases are centres of drug dealing and other criminality.