The slain Maoists were identified as Gemmeli Narayan Rao alias Jambri and Chittibabu.
The two were killed in an exchange of fire near Annavaram area under Mampa police station limits in Koyyuru mandal.
The incident took place at around 8.30 this morning.
Jambri was a divisional committee member of Galikonda area committee of the banned CPI (Maoist), police said.
Police also recovered a Thompson sub-machine gun, a shotgun and three detonators, said the superintendent of police (Visakhapatnam rural) Rahul Dev Sharma.
Jambri, native of Mettiguda under GK Veedhi Mandal in Vizag Agency area, carried a reward of Rs 4 lakh on his head.
He had played a key role in the killing of 37 members of Greyhounds in Balimela in 2008, the SP said.
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