Police said six victims with gunshot wounds were found near St Clair Avenue West and Arlington Avenue in the Canadian city, where a Latino-themed cultural festival was taking place.
Two victims were pronounced dead at the scene. The conditions of the injured victims were not immediately known.
Officers initially urged the public to avoid the area while they responded.
They later said the scene had been secured but cautioned that a suspect had not been apprehended.
A large police presence remains in the area.
Ontario premier Doug Ford said in a social media post: “I am devastated by the senseless violence at the Salsa on St Clair Festival that has claimed two lives and injured others.
“My thoughts are with the victims, their families and everyone affected.”
He added: “Thank you to Toronto Police and our first responders for responding to this horrific incident.
“The person responsible must be caught, brought to justice and spend the rest of their life behind bars.”
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