Many people were injured, while several others feared to be trapped inside the debris.
The 'Tahir Biznor' building, situated in Navi Basti area, was unauthorised, a district official said.
The building collapsed around 9 am on Friday morning, Regional Disaster Management Cell chief Santosh Kadam said.
The deceased were identified as Ruksar Yakub Khan (18), Asfaque Mustaque Khan (38) and Jaibunissa Rafique Ansari (61).
The nine injured, including a six-year-old boy, have been admitted to the state-run Indira Gandhi Memorial Hospital and the civic hospital here, District Disaster Management Control officer Asmita Nikam said.
The National Disaster Response Force (NDRF) teams were rushed to the spot, along with fire-brigade teams from Bhiwandi, Thane, Navi Mumbai and Kalyan civic bodies.
Bhiwandi Tehsildar Shashikant Gaikwad, who was supervising the rescue operations, told PTI that the building, over 10 years old, was not on the list of dangerous buildings.
At least eight families lived in it, the officials said.
The officials said the possibility of some more people being trapped under the debris cannot be ruled out yet.