BRASILIA, June 28 (Reuters) - A Brazilian fugitive accused of murdering a family was shot dead on Monday, ending a 20-day manhunt with troops, dogs and helicopters in farm country outside Brasilia, where rural families lived for weeks in fear. Lazaro Barbosa, who fled jail after a previous murder conviction, was suspected of killing a father and his two sons in early June and kidnapping their mother, whose body was found days later in the countryside. TV channel Globonews showed images of a body being bundled into an ambulance by officers after Barbosa was shot. Police said he was dead on arrival in hospital. More than 270 soldiers and police took part in the hunt for Barbosa, who was on the run in the state of Goias, where he broke into farmhouses, held hostages and exchanged gunfire with farmers, wounding three people. At one point, he stole a car and was spotted by police trying to reach the outskirts of Brasilia. He set fire to the vehicle and disappeared into the fields, police said. The town of Cocalzinho was gripped with fear for days and many farmers fled their properties. "This crime brought so much terror that we could not sleep properly," local farmhand Marcos de Araujo told Reuters. "It used to be a very quite place. You could go out and leave your key in the door and nothing would happen," he said. Last week, police arrested a farmer accused of harboring the fugitive.