The man walked into the office at about 1 p.m., Maj. Michael Hambrook of the New Hampshire State Police told CNN affiliate WMUR-TV.

Hambrook and Clinton campaign officials said two people were believed to be inside.

Shortly before 2 p.m., police officers had taken positions across the street from the office, some kneeling behind police cruisers with guns drawn.

Witnesses described the man as in his 40s with salt-and-pepper hair, WMUR reported.

A woman and her baby were released by the hostage-taker, the woman told workers at a nearby business, according to the WMUR Web site.

A witness, Lettie Tzizik, told WMUR she spoke to a woman shortly after she was released from the office by the hostage-taker.

"A young woman with a 6-month or 8-month-old infant came rushing into the store just in tears, and she said, 'You need to call 911. A man has just walked into the Clinton office, opened his coat and showed us a bomb strapped to his chest with duct tape,'" the Web site reported.

Clinton, a candidate for the Democratic presidential nomination, is in the Washington area.

She was scheduled to speak at 3 p.m. at a Democratic National Committee event, but canceled the talk because of the situation, DNC Chairman Howard Dean said.

"Unfortunately as some of you know, there is a hostage situation in New Hampshire involving a Clinton campaign staff person," Dean told those who had gathered for the event.

"The details are sketchy at this time, but understandably Senator Clinton is now dealing with this very difficult problem and she is not going to be able to join us today. And we will keep them in our prayers and hope for a resolution to this situation in New Hampshire."

Buildings close to the storefront campaign office on Main Street were evacuated, including the local campaign center for another Democratic presidential hopeful, Sen. Barack Obama.

Cassandra Hamilton, who works in an office adjacent to the Clinton office, told WMUR: "I walked out and I immediately started running, and I saw that the road was blocked off. They told me run and keep going."

The Rochester office of former senator and Democratic candidate John Edwards remained open.