The building collapsed early yesterday and more than 110 people were still trapped by early afternoon, according to Ram Barot, an official of the Municipal Corporation of Greater Mumbai, whose employees were housed in the building.
Ten hours after the collapse, a young girl was pulled alive from the rubble to cheers from rescuers and onlookers.
Rescue workers had been using six cranes to remove debris and had earlier pulled dozens of people from the ruins. The building was believed to have been 35 years old and home to 20 families.
Preeti Pawar, who was standing among crowds of relatives and onlookers outside the collapsed block, said: "Five members from my family were trapped inside. So far, two have been rescued. I am praying to God others will also come alive."
Mumbai mayor Sunil Prabhu said the block was not on an official list of dilapidated buildings.
In April, a building collapse killed 72 people in Thane, near Mumbai. Officials later said the structure had been built using poor materials and did not have proper permission. A shortage of cheap homes has led to a rise in illegal construction by developers who use substandard materials and then offer rock-bottom rents to low-paid workers.
A sharp rise in property prices in Mumbai over the past five years has put affordable housing out of reach of tens of thousands of people.