According to the BBC, West Midlands Ambulance Service said it was dealing with a "serious incident" in Penn and was treating "a number of patients".
Police scrambled armed riot officers, police dogs and helicopters to the area and fired stun grenades in an attempt to distract the attacker.
"But when we got outside and saw all the police and the smoke we realised it had been some sort of stun grenades".
A woman thought to be in her 30s died at the scene in Leasowes Drive, in the Merry Hill area of the city, while the male suspect, also in his 30s, was pronounced dead shortly afterwards.
Images from the scene showed three air ambulances landed on a nearby playing field and armed officers outside the block of flats.
One of the injured people, a woman in her 50s, is said to be in critical condition.
Two officers had been injured on the scene, say police, including one that had been stabbed on his arm, and two more who were injured on their legs after being chased around by the knifeman. "It is really tragic".
The fourth victim - understood to be a police officer - received minor injuries which were treated at the scene.
A statement from West Midlands Police said: "Two people have died following a domestic stabbing in Wolverhampton this morning".
West Midlands ambulance service responded to reports of an assault.