The incident happened on the 38000 block of 159th Street East late Tuesday night.
The coroner removed the body of the victim early Wednesday morning. Animal Control officials were also on scene, as they took the suspect's dog into custody.
The victim, who was believed to be in his 40s, has yet to be identified.
The suspect, 58-year-old Michael Norton, was the victim's next door neighbor. Sheriff's deputies say the two men were in the victim's garage drinking together, when an argument broke out. The exact source of the argument remains unclear, but authorities say it had to do with being disrespected.
At one point, the argument turned physical. That's when Norton left, walked over to his house and returned some time later with a gun and shot the victim, said officials.
Police say the victim was a single father and had his two daughters inside the house at the time of the incident. Lt. Eddie Hernandez with the Los Angeles County Sheriff's Department said one daughter is 14 years old and the age of the second child was unknown.
It remains unclear just what those girls saw or heard. Investigators say they are now with a relative.
Area resident Harold Brand said his wife told him she heard two shots fired. Other neighbors said Norton has a drinking problem, but is otherwise never seemed violent. Brand said Norton has a gun collection in his house. He said he was surprised when he heard what happened.
"Saddened to hear what happened because my neighbor is not a bad person, not that type of person. He's kind of usually helps people and everything," Brand said.
Norton is being held on a felony murder charge at the Los Angeles County Sheriff's Department's Lancaster Station. Bail has been set at $1 million.