The fire broke out before dawn at the budget Hotel Arpit Palace in a congested part of central Delhi. A woman and a child, among those dead, were killed when they tried jumping from a window, reports said.
Three people jumped from the blazing structure even as 25 fire tenders rushed to the spot after receiving a call at 4.30 am.
Sunil Choudhary, Deputy Chief, Fire Officer speaking to ANI said, "Fire has been doused".
The injured were taken to local hospitals, but their medical conditions were not immediately known.
He says authorities are still investigating what caused the fire.
Images and videos posted on social media showed thick smoke and flames billowing out of the top floor of the hotel. At least 35 rooms were booked by members of one family, who were in the city for a special function.
Rescue and police personnel at the site of a massive blaze at Hotel Arpit Palace on Tuesday, after the fire had been doused.
"There was wooden panelling in the corridor because of which people couldn't use the corridors to leave the hotel", firefighter Vipin Kenta told the Hindustan Times newspaper.
Cooling process is underway and the cause of the fire is yet to be ascertained, he added.
The Delhi government has ordered a magisterial inquiry into the incident, Cabinet minister Satyendar Jain said.
Last week, a fire broke out in a hospital in Noida, forcing an emergency evacuation of scores of patients and other people.
"Buildings can only be constructed up to four floors in Delhi", Delhi's home minister Satyendra Jain told NDTV.
Building regulations and fire safety measures are routinely flouted by builders and incidents of fires are reported nearly every week from across the country.