The lone shooter was armed with three weapons when police surrounded him inside the college, where officers shot him dead, Montreal police director Yvan Delorme told reporters.
The suspect was a 25-year-old Canadian man.
Mr Delorme confirmed that the shooter acted alone, ending earlier speculation that there could be as many as three shooters.
The shooting had left 20 people wounded, including a woman who later died of her wounds at the school. Radio-Canada reported that the person killed was a 20-year-old woman.
"The 19 others were taken or went themselves to a hospital for treatment," Mr Delorme said.
Medical sources say five others wounded are in a critical condition.
Authorities say they do not know the motive for the shooting, but add there is no indication that it was an act of terrorism or was motivated by racism.
Frightened students
"We were in class. We heard gunshots, a couple of gunshots. We heard a bunch of girls yelling," student Daniel Harrosh, 17, said.
"I opened the door, I saw a bunch of people running, I closed it, then the teacher came. He locked the door and then said something major was going on in the other room. At a certain point, the lights went off. We heard several gunshots, a dozen maybe," Mr Harrosh said.
Student Roxanne Michaud, 19, said she locked herself into a classroom with four other students and two professors for two and a half hours when the shooting began.
"We listened to the radio and checked the Internet to find out what was happening," she said. "We couldn't call anyone because the portable telephones did not work."
Devansh Smri Vastava said he saw a man in military fatigues with "a big rifle" storm the school's cafeteria. "He just started shooting at people."
"We all ran upstairs. There were cops firing. It was so crazy," Vastava said. "I was terrified. The guy was shooting at people randomly. He didn't care he was just shooting at everybody. I just got out."
Witnesses said the shooter had a Mohawk haircut and appeared to be armed with an AK-47 rifle. According to Radio-Canada, he was of Indian or Sri Lankan origin.
Evacuations
The lunchtime shooting at Dawson College, an English-language university preparatory school, paralysed downtown Montreal, as terrified students fled in droves and police blocked off streets, even closing a train station which had access to the school.
A skyscraper and retail centre next to the college was evacuated by authorities.
Hours after the shooting, groups of students still shocked by the incident sat near the police perimeter surrounding the campus, hugging each other for comfort. Onlookers flocked to the site as helicopters circled above.
Canadian Prime Minister Stephen Harper described the incident as "a cowardly and senseless act of violence."
Montreal Mayor Gerald Tremblay described the incident as a "very unhappy event," but also one that was "isolated."
The shooting recalled the so-called Montreal Massacre on December 6, 1989, at Montreal's engineering school Ecole Polytechnique where a gunman, Marc Lepine, killed 14 female students before killing himself.