Knight was one of three club patrons struck by gunfire around 1:30 am (1830 GMT) at the 1OAK on West Hollywood's Sunset Boulevard, said Sgt C Tatar, watch commander at the Los Angeles County sheriff's West Hollywood station.
Two other victims, a man and a woman, were also being treated at local hospitals and were expected to survive.
Authorities are still seeking a suspect and declined to release additional information, citing the ongoing investigation.
R&B singer Chris Brown, who was co-hosting a party at the nightclub with Pia Mia, was also inside the club but not hit by the gunfire, Tatar said.
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MTV said it had no affiliation or connection to the event. Representatives for Brown and the party did not return a call for comment. Calls to the club rang unanswered.
Knight has been shot before. In 2005, he was struck in the leg during an MTV awards pre-party in Miami.
Knight's genius for poaching up-and-coming talent helped him land and make megastars out of Tupac Shakur, Snoop Dogg and Dr Dre and shifted the center of the rap universe to the West Coast the 1990s.
Financial troubles also eventually lead to his Death Row Records filing for bankruptcy.