It is understood Australians were also there at the time although no one has been officially identified.

Local media reports the jet ski operators had been ferrying holiday-makers out to sea on the packed Koh Samui island when an argument broke out over whose turf it was.

The rift between Soontree Chaipet, 45, and Tinapot Petcharat, 26, who later died in hospital, quickly escalated into a bloody shooting.

Grainy CCTV footage showed the moment they opened fire at each other, sending tourists at nearby restaurants running for cover.

Police arrived at around to find both men in a pool of blood on the sand.

Koh Samui is an incredibly popular holiday destination among Australian tourists.

Horrified onlooker Num Hankit, 30, said: “I work near the beach and just heard the bullets and came to look.

“It’s scary, anybody could be hit by a bullet. People are riding jet skis with guns in their pockets. I cannot believe this happening on a beach.

“There were more than 100 tourists standing on the beach. They looked shocked. They have a holiday and people are shooting each other. It’s dangerous.’’

The older man was driven to hospital while paramedics performed CPR on Tinapot as tourists in their swimming trunks stood watching in disbelief.

Officers later recovered two weapons, a black 9mm handgun and a smaller silver pistol as well as ammunition on the Chaweng Beach.

Police Major General Apichat Boonsaree from the Bophut station said they believed the reason for the gun fight was a ‘’business conflict when renting jet skis to customers’’.

”Both sides are involved in the business of renting jet skis on the beach and they took up a duel with each other.

“They were both carrying guns and we understand that they had many arguments with each other before.

“However, the investigators must speak to all the witnesses and people involved in order to understand the exact cause.

“Officers arrived and ensured the safety of tourists who were relaxing at the time when the shots could be heard.

“Police are in attendance at the hospital where the survivor is and we will interrogate him once he has regained composure.’’