A boy was being held hostage in a bunker in Alabama early Wednesday by a man who seized him from a school bus after fatally shooting the driver, witnesses and police said.

Authorities were negotiating with the man overnight at the scene near Midland City.

The driver of the bus died from gunshot wounds on Tuesday afternoon and the suspect was not in custody, according to the Dale County Sheriff's Department.

Witnesses told NBC station WSFA that the suspect boarded the bus and ordered some children off before grabbing a boy aged 5 or 6, shooting the driver and fleeing towards his nearby home.

Michael Senn, who is minister of a nearby church, told the station that he spoke to several children on the bus, including a girl who said the driver was shot four times. He described one 13-year-old as "really traumatized."

Mike Creel, who said he was the suspect’s neighbor, told the station the suspect had hidden “in his homemade bomb shelter.” However, officials described it as a storm shelter.

Creel said the suspect has lived on the property for around two years and that the underground shelter was “one of the first things he started building."

The station said police believed the child was "OK" and that police were conducting negotiations with the suspect using a plastic pipe.

Other neighbors identified the suspect to the local newspaper, the Dothan Eagle, as a 67-year-old man. NBC News was unable to confirm this early Wednesday.

Lisa Harden, of the Dale County School District Office, said the bus was on a route that served all local schools, and had children of all ages on board.

Dale County and Ozark city schools will be closed Wednesday, officials said.

"Due to the sensitive nature of the open and ongoing incident, limited details are being released at this time," Dale County Sheriff's Department said in a 10 p.m. local time (11 pm. ET) Tuesday update.