Local media reported that Eric Torell, 20, was shot by officers in Stockholm in response to what they described as a "threatening situation" in the early hours of Thursday morning.
He had been reported missing by his family after disappearing from his home hours earlier and was carrying the toy gun, which had been a gift.
Mr Torell’s mother, Katarina Söderberg, said her son was "the world's kindest man" who “wouldn't hurt a fly”.
Ms Söderberg told Swedish newspaper Expressen that her son was severely disabled and struggled with his speech, only ever really using the word "mum".
Police said the shooting happened at 4am local time (3am BST) when they were called to reports of a man in possession of a gun.
Officers reportedly ordered Mr Torell to discard what they believed to be a dangerous weapon and opened fire when he failed to comply and acted "threateningly", police said.
The young man was taken to hospital but was later confirmed dead from his injuries. An investigation has been launched into the incident.
Ms Söderberg said her son had left home a number of times previously but had always been found or returned by himself.
