The mishap took place when the workers were moving a tank containing Light Diesel Oil (LDO), said sub-inspector R N Dave of Velavadar-Bhal police station.
The factory is located in Kala Talav area on the outskirts of the city.
The deceased were identified as Shambhu Kumar and Akhilesh. Umesh Kumar, who was injured, was rushed to a hospital.
"After moving the tank containing LDO, two workers climbed on top of it to do some inspection. Suddenly the top portion of the tank blew off, killing both of them and injuring another worker who was standing nearby," Dave said.