She described how "everybody starting running in and screaming" after gunfire was heard on the beach.
She added: "It sounded like a machine gun going off...there was an explosion a little later."
Terrifying ordeal: a large gun can be seen next to the man's body
David Schofield told Sky News: "We heard people saying there were guns on the beach and people were shooting on the beach.
"I went to reception and they said the police have told us to get everyone inside.
"About five minutes ago I saw some people running. There are some people on the roof but I think that's a representative from the hotel.
"No one is injured that I can see."
Tourists were attacked on the beach at the Imperial Marhaba hotel in Tunisia
Holiday brands Thomson and First Choice said they were "aware of a suspected terrorist incident in Tunisia".
They added: "We are working closely with our teams in Tunisia and the relevant authorities to determine exactly what has happened and provide assistance to those affected.
"More information will be released as it becomes available."
The attack came just hours after a man was beheaded in an attack by Islamists at a gas plant near Grenoble in France.