A policeman is in hospital after being shot Friday night during a routine traffic stop in Hamilton.

Two people have been arrested in relation to the incident, which happened just before midnight on Bankwood Rd, Chartwell. 

Police said a passenger in the vehicle got out of the car and fired at the officer, hitting him in the shoulder, before stealing his car and fleeing. The driver also fled.

The officer is in a stable condition at Waikato Hospital. 

The stolen police car was found a couple of hours later on Gordonton Rd, to the city's northeast, after a search involving the armed offenders squad and Eagle helicopter. The driver's car was found on Sherwood Dr, in the suburb of Pukete, at 4am. 

The driver was found at that address and arrested, with another man - believed to be the passenger - arrested later on Saturday morning at an address in Ngaruawahia.

The firearm believed to have been used in the shooting was also recovered.

Police said the 23-year old will face a range of charges.

"Residents can expect to see a continued police presence at the scene of the shooting in Bankwood Rd this morning," police said earlier on Saturday.