The shooting on a frontline of the 1975-90 civil war marks some of Lebanon's worst strife in years, and highlights a deepening crisis over the probe into the August 2020 blast that is undermining government efforts to tackle one of the most dramatic economic meltdowns in history.
In scenes reminiscent of the war, local television stations broadcast footage of bullets bouncing off buildings and people running for cover.
Army units were seen patrolling the area and a fire truck arrived to the location where fire caused by heavy gunshots broke out.
One of the dead was a woman who was struck by a bullet while in her home, a military source said, adding that all the dead so far were Shi'ites.
The army said in a statement the gunfire had targeted protesters as they passed through the Teyouneh traffic circle located in an area dividing Christian and Shi'ite Muslim neighborhoods.
Hezbollah and its ally, the Shi'ite Amal Movement, said groups had fired at protesters from rooftops, aiming at their heads in an attack they said aimed to drag Lebanon into conflict.