They said the incident took place this morning at a cafeteria of the Forbidden City, also known as the Palace Museum, in downtown Beijing.
A 49-year-old man, only identified with his surname Zheng, stabbed two of his colleagues with a knife, state news agency Xinhua reported quoting police.
One victim was already dead when police reached the spot while the other died after rescue efforts failed, the report said.
Zheng, who was also injured after he apparently attempted suicide, was taken into police custody. He is now undergoing treatment at a hospital here.
The Forbidden City, the sprawling former palace of China's emperors, receives about 60,000 visitors daily. The palace is made up of over 980 buildings and houses many historical artifacts.
Incidentally, Chinese Premier Li Keqiang took his Indian counterpart Manmohan Singh for a walk at the Forbidden City on October 23 giving him a guided tour.