Europe minister David Lidington said he met with his Spanish counterpart, Inigo Mendez de Vigo, to "protest in the strongest terms" about the incident in British waters on Sunday.
"During an illegal incursion by a Guardia Civil (police) vessel, a Guardia Civil officer fired a weapon," Lidington said in a statement issued after the meeting in Luxembourg.
"I made clear that the discharge of a weapon in or near Gibraltar is completely unacceptable.
"I urged Senor Mendez de Vigo to investigate urgently and to take action to ensure that this will not happen again."
Lidington added that the British charge d'affaires in Madrid would be delivering the protest in person to the Spanish foreign ministry and would "request a full explanation".
In November, Spain and Britain summoned each other's ambassadors in a spat over a series of naval incidents around the small but strategically situated territory.
Britain has held Gibraltar since 1713 but Spain wants it returned and refuses to recognize British sovereignty over the waters off the land known as 'the Rock'.