The Wisconsin Justice Department said Rusten Sheskey, a seven-year veteran of the Kenosha Police Department, shot Mr Blake while holding onto his shirt after officers first unsuccessfully used a Taser.
State agents later recovered a knife from the driver’s side floorboard of the vehicle, the department said.
The man who said he made the widely circulated mobile phone video of Mr Blake’s shooting has said he heard officers yell, “Drop the knife! Drop the knife!” before the gunfire erupted.
He said he did not see a knife in Mr Blake’s hands.
State authorities did not say Mr Blake threatened anyone with the knife.
Mr Blake, 29, was shot in the back seven times as he leaned into his vehicle, three of his children seated inside.
Kenosha police have said little about what happened other than that they were responding to a domestic dispute.
The Milwaukee Bucks did not leave their locker room as three NBA play-off games, three Major League Baseball matches, three WNBA fixtures and five Major League Soccer games were called-off after player-led actions.
Tennis star Naomi Osaka also withdrew from her semi-final at the Western & Southern Open in New York, scheduled for Thursday, saying “before I am an athlete, I am a black woman”, with the tournament later announcing it would suspend play for the day.
It comes after a white 17-year-old police admirer was arrested over the killing of two people gunned down during a third night of protests in Wisconsin.
Kyle Rittenhouse, of Antioch, Illinois, was taken into custody on suspicion of first-degree intentional homicide. Antioch is about 15 miles from Kenosha where protests have been taking place.
Two people were shot dead on Tuesday night in the attack carried out by a young white man who was caught on mobile phone video opening fire in the middle of the street with a semi-automatic rifle.
“I just killed somebody,” the gunman could be heard saying at one point during the shooting rampage that erupted just before midnight.
One victim was shot in the head and the other in the chest, Sheriff David Beth told the Milwaukee Journal Sentinel. A third person suffered gunshot wounds not believed to be life-threatening.
In the wake of the killings, Wisconsin Governor Tony Evers authorised 500 members of the National Guard to support local law enforcement around Kenosha, doubling the number of troops sent in.
The governor’s office said he was working other states to bring in additional National Guard troops and law officers.
“We were all chanting ‘Black lives matter’ at the gas station and then we heard, boom, boom, and I told my friend, ‘That’s not fireworks,’” 19-year-old protester Devin Scott told the Chicago Tribune.
“And then this guy with this huge gun runs by us in the middle of the street and people are yelling, ‘He shot someone! He shot someone!’ And everyone is trying to fight the guy, chasing him and then he started shooting again.”
Mr Scott said he cradled a lifeless victim in his arms, and a woman started performing CPR, but “I don’t think he made it”.
According to witness accounts and video footage, police apparently let the young man responsible for the shootings walk past them with a rifle over his shoulder as members of the crowd were yelling for him to be arrested because he had shot people.
Much of Rittenhouse’s Facebook page is devoted to praising law enforcement, with references to Blue Lives Matter, a movement that supports police. He also can be seen holding an assault rifle.
Other photographs include those of badges of various law enforcement agencies, including the Chicago Police Department.
All of the badges have a black line across them — something police officers do with black tape or another material whenever an officer is killed in the line of duty.
The sheriff told the Journal Sentinel that armed people had been patrolling the city’s streets in recent nights, but he did not know if the gunman was among them.
“They’re a militia,” Mr Beth said. “They’re like a vigilante group.”
The FBI said it is assisting in the case.
Wisconsin Lieutenant Governor Mandela Barnes, who is black, said in an interview with the news programme Democracy Now! that the shootings were not surprising and that white militias have been ignored for too long.
“How many times across this country do you see armed gunmen, protesting, walking into state Capitols, and everybody just thinks it’s OK?” Mr Barnes said. “People treat that like it’s some kind of normal activity that people are walking around with assault rifles.”
