Police cordoned off the area around the Clover Inn Motor Hotel as they continued to investigate Sunday. (CBC)

One man was killed and another injured in a shooting Saturday night in Surrey, B.C., that police say looks like a targeted hit.

RCMP Cpl. Dale Carr with the Lower Mainland's Integrated Homicide Investigation Team said the two men were shot at about 11 p.m. near 176th Street and 57th Avenue in Cloverdale, a town centre in Surrey, about 40 kilometres southeast of Vancouver in the Fraser Valley.

The shooting took place in the washroom of the Legacy Show Lounge at the Clover Inn Motor Hotel, just a few blocks from the fairgrounds where the 63rd annual Cloverdale Rodeo was taking place.

The two men were rushed to hospital, where one victim, a 34-year-old Surrey man, later died.

The second victim, a 28-year-old Surrey man, was still in critical condition Sunday afternoon.

Carr said the deceased was not known to police, while the injured man was. The initial investigation indicates the two victims did not know each other, he said.

The names of the victims have not been released.

The shooting has all indications of a targeted hit, but Carr said it's not known which victim was the intended target.

Police said a male suspect in his early 20s, wearing dark clothing including a dark hooded sweatshirt, was seen fleeing the lounge through the rear of the building moments after the shooting took place.

The area remained cordoned off Sunday morning as police continued to investigate. Carr said officers were looking to interview more witnesses who may have fled when the shooting took place.

Carr said it was not clear whether the incident was related to gangs or the drug trade.