Ramesh Upadhyay, who is wanted in multiple cases of bank robbery, murder and dacoity, was killed along with an accomplice while he was allegedly preparing for a bank robbery in Chembur suburb, police said.
Acting on a tip off, police waited for the gangsters near the Oriental Bank of Commerce in Chembur.
When the gangster arrived with his accomplice, police asked him to surrender, but Upadhyay instead opened fire with a country made pistol.
Police returned fire and in the ensuing shootout, Upadhyay and his unidentified accomplice were killed, they said.
A country made pistol and four live rounds were recovered from Upadhyay, police said adding, the gangster had multiple cases registered against him in the city, Navi Mumbai and Pune.
Upadhyay and his gang were also accused of a bank robbery in Navi Mumbai in 2006 in which two police officials were killed, police said.