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11 January 2018, 09:30 | Terri Saunders
French police attend the scene outside the Ritz Hotel in Paris
During the robbery, the gang of five smashed the window of a jewellery store at the hotel with axes and looted the pieces on display, Xinhua reported.
The three suspects were arrested near the chic Place Vendome in central Paris but none of the jewels or other items has been recovered so far.
Three of the gang were detained while fleeing the scene and an AFP journalist said some roads around the hotel were sealed off by security forces following the incident.
As the robbers opened fire on the hotel, guests at the Hemingway bar were told to "get down", eyewitnesses have said.
"We heard at least 10 rounds of gunfire so everyone dove behind the bar where we stayed there for about six minutes".
Some of the thieves were thought to have been armed with axes.
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The French TV station BFM said that 4.7 million euros (£4.16m) worth of jewels were taken.
The Ritz-Carlton is located in the 1st arrondissement and overlooks the Place Vendôme.
It was the last place Princess Diana stayed before her fatal vehicle crash and is popular with elite guests from around the world.
The 18th century private mansion was opened as a hotel in 1889 by the Swiss hotelier César Ritz, whose obsession with style and luxury led to the creation of a new English word, "ritzy".
The hotel was bought in 1979 by Mohamed Al-Fayed, whose son Dodi was also killed in the fatal crash.
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