St. Louis Police Chief Sam Dotson said the shooting took place as officers were carrying out a search warrant and two young black men ran out the back door of the targeted house.
Officers ordered the pair to stop in the alley behind the house. One suspect pointed a gun at officers who then fired about four times, killing him, Dotson said.
Reuters video showed dozens of protesters blocking a nearby intersection. They were monitored by police backed up by an armored vehicle.
Three people were arrested for blocking traffic, police said.
Police identified the slain suspect as Mansur Ball-Bey, 18. The second suspect fled and was described in his mid- to late teens.
Dotson told reporters Ball-Bey's gun was stolen. He said officers recovered crack cocaine at the scene.
"Detectives were looking for guns, looking for violent felons, looking for people that have been committing the crimes in the neighborhood," he said.
A 93-year-old member of the Tuskegee Airmen, a pioneering black aviation unit from World War Two, was robbed and carjacked in the neighborhood on Sunday. A woman was also killed this week in the area.
St. Louis police said the officers involved in the shooting were both white, ages 33 and 29, each with about seven years on the force. They are on administrative leave.
The shooting came 10 days after the St. Louis area was flooded with protesters from around the United States marking the anniversary of the Aug. 9 police killing of unarmed black teenager Michael Brown by a white police officer.
Brown's death helped spur a nationwide movement against what protesters say is a pattern of police violence against minorities.
Wednesday's shooting came as activists were in the area to mark the anniversary of the police shooting of another black man in St. Louis, Kajieme Powell.
