Since September, Rocinha favela has seen several confrontations during an ongoing turf war between narco gangs seeking control of drug trafficking in the area.
Eight people were killed during a police operation on Saturday morning in the violent Rio de Janeiro favela of Rocinha, authorities said.
The military police, currently operating across Rio de Janeiro state, said troops were patrolling two areas in the south and southeast of the favela when "they entered into a confrontation with criminals."
After the incident police said a rifle, seven pistols and two grenades were seized.
Relatives of the victims told the local press that their loved ones had no links with traffickers.
"They killed my son with a bullet in the back," the father of Matheus da Silva Duarte de Oliveira, 19, told the G1 website.
According to his father, Matheus had no connection with drug trafficking and was taking part in a funk dance party.
Around 100,000 people live in the Rocinha favela, mostly in unsanitary conditions.
Public security in the state of Rio has since last month been under controversial military control ordered by President Michel Temer, who cited a breakdown in law and order.
But there has been little evidence that the situation is coming under greater control.
Last week, a one-year-old toddler was killed in a shootout between police and drug gang members in the Alemao favela days after the assassination-style shooting of Marielle Franco, a city councilwoman known for her outspoken protests against police brutality.