A manhunt is currently ongoing to arrest the suspect.

Witnesses alerted authorities at around 9:40 p.m. saying an unknown perpetrator had attacked several people at random with a knife at the Fronhof, a central square in the city, about 25 kilometers (15 miles) east of Dusseldorf, German police said during a press conference as quoted by CNN.

The lone male suspect is on the run and special police forces have been deployed to the active manhunt, police added.

The attack took place during the “Festival of Diversity", the three-day event to mark the 650th anniversary of the city's founding.

The motive behind the attack is still not clear.

Herbert Reul, interior minister for the state of North Rhine-Westphalia, was quoted as saying by CNN: "None of us know why this happened. I can’t say anything about the motive, about the person."

City Mayor Tim Kurzbach expressed sadness over the loss of lives in the incident.

In his Facebook post, he said: "Tonight we are all in Solingen in shock, fright and great sadness. We all wanted to celebrate our city anniversary together and now we have to mourn the dead and injured. Breaks my heart that there was an assassination attack on our town. Tears in my eyes when I think of those we have lost. I pray for all those who are still fighting for their lives."

All events, which were scheduled to be held on Saturday and Sunday, have been cancelled.

Solinger Tageblatt's deputy editor Björn Boch told BBC that the celebrations had been "supposed to last for three days, and the city expected 25,000 people every night.

"The city was just packed with people," he said, estimating that "a few thousand people" were at Friday's free event.

Heavily armed SEK units with about 40 special vehicles from all over North Rhine-Westphalia had been deployed to Solingen, DW reported quoting Bild.

With a population of about 160,000, the city in North Rhineland-Westphalia, is popularly known for its steel industry.