Chinese police say that a car veered off the road at the north end of the square, a major tourist attraction, crossing the barriers before catching fire.
The three people in the car died and a female tourist from the Philippines and a male tourist from southern Guangdong province also died.
In total 38 people were injured, three were tourists from the Philippines and one from Japan.
A witness said he saw fire engines, an ambulance and numerous police cars heading in the direction of the fire, which sent a plume of black smoke into the skyline.
The site became infamous after pro-democracy protests in 1989 were bloodily suppressed by the Chinese military.
Chinese Foreign Ministry spokeswoman Hua Chunying, was asked if the government believed the incident was a terror attack but said she did not know the specifics of the case and declined further comment.
The central and Beijing governments held a meeting after the incident to speedily investigate what happened and ensure “the security and stability of the capital”.
The car crashed almost directly in front of the main entrance of the Forbidden City, where a huge portrait of Communist leader Mao Zedong hangs. It is also the site of Mao’s mausoleum.
Tiananmen Square is always under heavy security due to its proximity to the Zhongnanhai compound of the central leadership and due to the Great Hall of the People which overlooks the square.
The square is still a magnet for protesters around the anniversary of the crushing of the student-led demonstrations in 1989 but dissenters are quickly bundled away by police.