A British man killed in the Saudi capital, Riyadh, has been named as Robert Dent, a 37-year-old father of two.
Saudi authorities have arrested the alleged assailant
Saudi television said he was shot by a man in a vehicle which pulled up alongside him as he sat in his car at traffic lights, and he died immediately.
Saudi authorities chased and caught the alleged assailant, a Saudi of Yemeni origin, named as Saud bin Ali bin Nasser, 30, who worked for a car dealership.
Dent, originally from Southport, Merseyside, was employed by the British defence and aerospace company BAE systems in Saudi Arabia.
His family, describing him as a "lovely man", said he had been married for about 13 years and had two children.
The killing comes amid rising tensions in the region.
On Wednesday, the British Government warned its nationals to leave Iraq immediately, and to avoid all but essential travel to Kuwait, Israel and the Palestinian territories.
It also comes after a string of violent incidents involving British nationals in the kingdom, the last one being a car bomb which killed a Briton in June 2002.
The Saudi authorities blamed those incidents on an illegal alcohol racket and have arrested several Britons in connection with the attacks.
However, the Saudi ambassador to the UK, Prince Turki al-Faisal, said on British television said that people should not jump to conclusions over the motive behind the shooting, which currently remains unknown.
"One should not allow speculation to be the norm but rather facts," he told Britain's Channel 4 news.
Thursday's attack took place between 1600 and 1800 local time (1300 and 1500 GMT) on Khaled bin al-Walid Street in the Granada district of Riyadh.
Paying tribute to Mr Dent, his uncle Leslie said he "loved his children to bits".
Mr Dent's parents, Bob and Denise, were returning home after hearing the news while holidaying in Spain, his uncle added.
BAE Systems spokesman Mike Sweeney said the company was "doing everything we can to support the family", who were "very very upset".
"We are saddened by this tragic event and the loss of a colleague."
UK Foreign Secretary Jack Straw also expressed shock and regret at the killing.
It has also emerged that there have been two other attempted shootings against BAE personnel in Riyadh in the last three weeks, both unsuccessful, says the BBC's Paul Adams, reporting from neighbouring Kuwait.
Westerners have also been killed in Kuwait in recent months.
Kuwait and Saudi Arabia are home to thousands of US troops, who are likely to take part in a possible war on Iraq.