GRAND BEACH, Mich. — Neighbors are on edge after police found a convicted murderer on the run in their neighborhood. Two other escaped prison inmates are still on the loose.

With their violent pasts, more than a hundred officers and federal agents are canvassing the area to get them all back behind bars.

The three men escaped from the Indiana State Prison in Michigan City Sunday morning. Investigators think they escaped from underground tunnels that were barred and locked.

They still aren't sure how they managed to get through them, how long it took or how long they'd been planning the escape.

Police arrested Charles Smith Monday morning in Grand Beach, just south of New Buffalo, not far from Chicago Mayor Richard Daley's vacation home. One of his security guards held Smith at gunpoint until police got there.

But they're still searching for Lance Battreal and Mark Booher.

Police say the best thing people can do while officers search is to stay inside their homes and lock their doors and windows. That goes for the whole area — New Buffalo Township, Grand Beach and Michiana Shores.

These convicts are considered dangerous. At one point, police were going door-to-door in the upscale Grand Beach area, making sure the two remaining inmates weren't hiding out in someone's house.

As the intense search continues, one thing is certain — no one ever expected something like this to happen here.

“This is a nice little community,” said Bill Bolger, who lives nearby. “The worst thing that happens is a traffic ticket.”

“Super nice people, very lovely place,” added Joel Blakemoor of Grand Beach Maintenance.

But Monday morning, Grand Beach turned in to something much different.

“There were helicopters flying around, lots of police officers,” Blakemoor explained. “We were just told to stay in the shop, and don't be out and about because there was a convict on the loose.”

One officer says the thick woods, muddy swamps and tall sand dunes made it seem like they were looking for a needle in a haystack. Officers searched every car leaving the area.

“He could be anywhere,” an officer said.

Police also canceled a day camp at the Grand Beach tennis courts, sending all of those kids home. They said that was the safest place for them to be.

“They should lock their doors, and if they see an individual matching that description they should call us immediately,” said Grand Beach Police Chief Dan Schroeder.

Few people actually took officers’ advice to stay home and abandon daily routines. Others were more careful.

"I don't feel good about it,” Bill Bolger said. “I went around, locked all the windows and doors in the house and garage now we're heading to town until this blows over."

All three of these men were serving lengthy sentences for violent crimes:

Lance Battreal was serving 50 years for a rape he committed in 1998 near Evansville. He was also serving time for criminal confinement and stalking.

Mark Booher is a convicted murderer and robber. He was supposed to be behind bars for 65 years.

Charles Smith — who police caught Monday — was serving 95 years in prison for murder.