French police have recovered some of the millions in jewels looted from the Ritz hotel in Paris, a police source told AFP yesterday, as officers hunt for two robbers who remain on the run.

The armed gang burst into the five-star hotel on the French capital's glitzy Place Vendome through a rear staff entrance on Wednesday evening and smashed the display windows of jewellery shops on the ground floor.

Three men were arrested as they tried to flee by the way they came in with bags of gems and watches worth over four million euros ($4.8 million) but came up against locked doors.

"Obviously there is a security system and an alarm in this type of establishment," a police source said.

Part of the loot was recovered after being scattered about during the arrest of the three suspects.

More jewels and watches were found in a bag dropped by one of the two robbers who got away, another source added, without being able to give an estimate for the value of the goods retrieved.

The three men arrested, all around 30 years old, are from the Seine-Saint-Denis area north of Paris, and are "well known to the police for armed robbery, violence and receiving stolen goods", a source close to the inquiry said.

The incident took place at around 6:30 pm (1730 GMT) as the streets were busy with workers making their way home.

A police team in charge of patrolling the square -- home to some of Paris's top jewellers and watchmakers, as well as the justice ministry -- was quickly on the scene.

Place Vendome has been the scene of several daring jewellery heists in recent years.

Local security has been beefed up in 2014 but robbers have continued to strike.

Several luxury brands display their jewels in the storied Ritz, famous as the lodging of choice for Coco Chanel and Ernest Hemingway as well as Princess Diana, who stayed there before her death in a car crash in a Paris tunnel in 1997.

Wednesday's robbery took place 18 months after the hotel re-opened its palatial doors to guests after nearly four years of renovations and a massive fire.

The suspects were wearing gloves and balaclavas and carrying handguns as well as hatchets, according to police sources.

On finding their escape route blocked they tried to transfer the loot through a window to two accomplices waiting outside.

One of the two accomplices fled by car, while the other made a getaway on a motorbike, dropping a bag of jewels in the process.

On Thursday, the source close to the inquiry said the car had been found in the Val d'Oise department, near Seine-Saint-Denis.

The hotel's management has declined to comment on the robbery.