Armed police were sent to Cobden Street, in Palfrey, where two cars and a house caught fire, gunfire was reported and a road traffic collision took place on Tuesday afternoon.
Firefighters and ambulances also attended the scene just after 1pm.
A spokesman for West Midlands Ambulance Service said: "We were called to reports of a road traffic collision and a car and house fire on Cobden Street at 1.06pm.
"We sent two ambulances, three paramedic officers, the Trust’s Hazardous Area Response Team and the Midlands Air Ambulance Critical Care Car to the scene.
"On arrival we discovered a total of four patients.
"A man, who was treated for gunshot injuries, and a woman who was treated for injuries sustained in the road traffic collision were both taken to hospital with serious but non life-threatening injuries.
"Two other patients, a man and a child, were assessed for the effects of the smoke inhalation and discharged at the scene."
Police armed with semi-automatic weapons were sent to the street, as thick black smoke poured into the sky from burning cars, with the flames spreading to a nearby house.
The dramatic events have left residents worried about the levels of crime in their neighbourhood.
One man, who wished to remain anonymous, said: "I'm not really shocked [to see the road taped off]. We heard someone got shot. This happens quite often around here."
Another man said: "I an a local resident. I am concerned about levels of crime around here, we all here. It is endemic. Residents live in fear."
One woman said: "It is shocking to see what has happened."
West Midlands Police said a 4x4 crashed into a stationary black VW Golf at the junction with King Street, leaving one occupant and a female pedestrian injured.
Moments later shots were fired from another vehicle before the occupants of the 4x4 set fire to their vehicle and made off. The blaze spread to the VW Golf and to a nearby house.
Detective Inspector Chris Fox, from West Midlands Police's CID, described the events as "confusing".
"Violence like this on our streets is not acceptable. I understand it’s a shocking and disturbing incident, but I do believe the people in the cars were targeting each other."
Anyone with information can contact West Midlands Police via live chat on the force's website or call 101, quoting log 2022 of May 4.