It is not known if he is armed or if anyone has been hurt.
The service was being streamed live when the incident started. The feed has since been taken down, but not before an angry man could be heard saying he did not want anyone to be hurt.
Police deployed special weapons teams and local people were evacuated.
At least four hostages - including the rabbi - are believed to be inside the synagogue, two law enforcement officials told The Associated Press on condition of anonymity.