Clare Nowland is fighting for her life after staff at her NSW nursing home called the police on Wednesday morning, fearing she had a kitchen knife.
Officers reportedly struggled to disarm her before one pulled out their tasers and fired as she stood next to her walking frame.
Mrs Nowland, who was well known in the local community and is believed to have been at Yallambee Lodge near Cooma for about five years, collapsed and sustained critical injuries.
NSW Police initially described the incident as "an interaction" between police and the woman but Commissioner Webb on Friday stressed police understood the gravity of the situation.
"My thoughts are with the family at this difficult time," she said.
"I understand and share the community concerns and assure you that we are treating this matter with the utmost seriousness.
"A Critical Incident Investigation is currently being conducted into the circumstances of the incident."
NSW Council for Civil Liberties president Josh Pallas said police shouldn't be using tasers on vulnerable people experiencing dementia or a mental health crisis.
"Surely, there must be more appropriate ways to deal with non-compliant people who are suffering," he said.
According to NSW Police guidelines, an officer can use a stun gun when violent resistance is occurring or is imminent or when an officer is in danger of being overpowered.
The Snowy Monaro Regional Council, which runs Yallambee Lodge, said staff had followed procedure.
"Council are supporting our staff, residents, and families during this difficult time," the council said in a statement.
Yallambee Lodge is a 40-bed facility designed for people who can no longer look after themselves in their own homes, according to the council's website.
Mrs Nowland's family, who have asked for privacy, are believed to be at her bedside.