Police said that Rashid Bengali and Israr Baluch had been killed after a clash between their gangs last night.
"Both of them headed rival gangs and authorities had kept a head money of 500,000 rupees on them," an official said.
"First Israr killed Bengali after a heated argument and later he was killed by members of the Bengali's gang," the official said, adding that five people had died in the clashes leading to tension and fear in the capital.
In other incidents of violence one person was killed by unidentified gunmen in Quaidabad while another one was shot down in Liaquatabad area of the city.
Police said two persons were killed in Korangi while a bullet ridden body was found in Karachi