Eleven people died after inhaling toxic gas in the city's thickly-populated Giaspura area on Sunday, police said.
Four more people, who were taken ill, were undergoing treatment at a hospital, they said.
The source of the leakage and the type of the gas are yet to be ascertained, they added.
However, Ludhiana Deputy Commissioner Surabhi Malik said it was likely that some chemical reacted with methane in manholes.
The DC said the area has been evacuated and added that the cordon at the scene of the leak will be extended as the gas spreads.
"We are going to collect samples from manholes. It is quite likely that some chemical reacted with methane in manholes," she said.
She said those who died in the incident did not show any symptoms of respiratory problems.
"It is likely that the deaths were caused by a neurotoxin," Malik added.
A district administration official said a team of the National Disaster Response Force (NDRF), which has reached here, will ascertain the source and the type of gas.
As it was a thickly-populated area, the immediate priority was to evacuate people from the place, the official further said.
The Ludhiana DC said an NDRF team is engaged in extracting samples of various kinds of chemicals.
She said once the nature of chemical reaction is ascertained, the details will be shared.
Police have sealed the area while a fire brigade and an ambulance have been deployed there.
Police said the casualties comprise five females and six males. Two boys aged 10 and 13 are among the 11 who died in the incident.
The DC said the gas, which leaked, has diluted to a large extent.
She said there was no need to panic and asked people not to fall prey to rumour mongering. She also appealed to people to stay away from the area. "But a check will be conducted to see how far this gas spread".
"We are collecting samples from manholes to just check what it is exactly and which gas came out after which chemical reacted with what. We are checking this and to what extent it spread, we are also checking it,"Malik added.
She further said that CCTV cameras were being scanned.
The DC said different teams of district administration, police, municipal corporation and Punjab Pollution Control Board are stationed at the site.
Earlier, an NDRF official said it was yet to be found out which gas led to the tragedy. "We will check it first then we will let you know," said the official in a response to the type of gas.
Punjab Chief Minister Bhagwant Mann said the incident was very painful and added that all possible help is being provided.
"The incident of gas leak in Giaspura area of Ludhiana is very painful. Teams of police, district administration and NDRF are present on the spot. Every possible help is being provided..," Mann said in a tweet in Punjabi.
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