Fighting raged for hours after Ovidio Guzmán López was found in what authorities said was a routine patrol in the city of Culiacán.
Armed men were seen firing on police with bodies strewn in the road.
Police withdrew without Mr Guzmán in their custody to avoid further violence, officials said.
Mexico's security minister, Alfonso Durazo, told Reuters news agency that a patrol of National Guard militarised police came under intense fire from outside the house where they had located Mr Guzmán, forcing them to retreat from the building for their own safety and "to recover calm in the city".
A lawyer for the Guzmán family told the Associated Press, "Ovidio is alive and free."
Mexico's President Andrés Manuel López Obrador said he would hold a meeting of his security cabinet to discuss the incident.
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