As concertgoers left the venue in a panic, local authorities warned people to stay away from the area due to a "serious incident".
Police have since released a statement regarding the incident.
"There are a number of confirmed fatalities and others injured," the statement reads.
"Details of a casualty bureau will follow as soon as possible."
Witnesses recorded the hysteria and shared it on social media.
“Just got out of Manchester arena after seeing Ariana perform. There was a loud bang when the lights came on & everyone ran out screaming," one fan wrote.
"Two loud bangs heard around Manchester arena. People running out of the arena. No idea what's going on," another wrote.
Billboard has confirmed that Ariana is "okay" after the incident.
A fan who was present at the show vlogged about the incident. His account of the story can be viewed here.
The attack is currently under investigation by authorities.