The under-construction plant of Ank Pharma, where the explosion took place, is located in a Maharashtra Industrial Development Corporation (MIDC) area at Kolwade village, officials said.
According to Palghar Additional Superintendent of Police Vikrant Deshmukh, six persons died while seven were injured in the incident. Earlier, a local police official had put the death toll at 8.
The blast, which took place during the testing of some chemicals around 7.20 pm, was so huge that it was heard within a 15-km radius, and window panes of some houses in the surrounding area shattered, officials said.
The under-construction plant building collapsed after the explosion.
The rescue operation was underway till late at night.
Chief Minister Uddhav Thackeray announced assistance of ₹5 lakh each for the kin of the deceased, a statement from his office said.