A man was arrested at the Cannes Film Festival Friday after firing a starting pistol during a live TV broadcast on the palm-lined waterfront, sending actors Christoph Waltz and Daniel Auteuil running for cover.

French TV station Canal+ was interviewing Austria's Oscar-winning Waltz and French actor Auteuil live on its nightly news show from a beach-front set before a crowd of spectators when a man fired two shots into the air.

"The bodyguards jumped over the barriers into the crowd and pulled him to the ground. The police arrived and told everyone to run because there was a grenade in his hand," witness Arthur Laiguesse told Reuters.

Police arrested the man at the scene and found he was carrying a dummy grenade and a knife, authorities said.

"It really appears to be a crazy guy," said a police source.

After the man was taken away, the show's producers told the crowd the programme would continue: "The show must go on."

Waltz, who has won two best supporting actor Oscars for "Django Unchained" and "Inglourious Basterds", and Auteuil, both of whom are serving on the Cannes jury, returned to the set.

The shooting was the second security incident on day three of the 12-day festival, the world's largest cinema showcase that attracts thousands of actors, directors, film executives, journalists and fans.

A police source said $1.4 million worth of Chopard jewellery intended to adorn movie stars had been stolen from a room at the Suite Novotel Hotel overnight Thursday.

But Chopard said the value had been exaggerated and the items were not for actresses to use, declining to give further details.