The typhoon, categorised as 'strong' with gusts of up to 60 metres per second (216 km per hour/134 mph), made landfall near Satsumasendai city located in the country's southwestern island of Kyushu on Thursday morning, the weather agency said.
Authorities warned the storm could be one of the strongest ever to hit the region, and local governments have issued evacuation orders for millions of residents in several prefectures.
One person is missing and 39 people are injured in Kagoshima and Miyazaki prefectures, public broadcaster NHK reported. Footage from NHK showed walls torn and window glass of buildings broken in Miyazaki, apparently by wind gusts, with objects scattered on the street or hanging from utility poles.
More than 250,000 households in seven prefectures are experiencing power outage as of 9:00 a.m. on Thursday (0000 GMT), according to Kyushu Electric Power Co.
After striking Kyushu over the next few days, the storm is expected to approach the central and eastern regions, including the capital Tokyo, around the weekend, the weather agency said.
Major automakers including Toyota and Nissan suspended operations for Thursday in some or all of their domestic factories due to the storm.
Airlines, including ANA Holdings and Japan Airlines, have already announced cancellations of more than 600 domestic flights. Train services have been suspended in many areas of Kyushu.
Typhoon Shanshan is the latest harsh weather system to hit Japan, following Typhoon Ampil, which also led to blackouts and evacuations, earlier this month.
