The Brinks Security employee, hired by the embassy, was shot outside the U.S. ambassador's residence next to the embassy building in central Athens. The 31-year-oldnational suffered a gunshot wound to the neck, police said.
Police and U.S. embassy officials ruled out terrorism but Greek authorities said the shooting did not appear to have been accidental, as initially believed.
Police spokesman Panagiotis Stathis said the shooting suspect was a 38-year-old police officers with no prior history of misconduct. He was taken into custody for questioning and has not been charged.
"This is not any other kind of attack. A policeman on duty fired two shots at a security guard. One of the shots hit him in the front of the neck," police spokesman Panagiotis Stathis said.
"Whether this was an accident is being investigated, but he fired two shots ... and his explanations which he has given so far are unconvincing."
Stathis said the policeman used a .32-caliber service revolver.
U.S. embassy officials said they were working with Greek authorities to investigate the shooting.
The victim was in serious condition at a nearby hospital.
The U.S. embassy is one of the most heavily guarded sites in the Greek capital.
The building was targeted in a terrorist attack in 2007. A far-left domestic militant group claimed responsibility for firing a rocket-propelled grenade.