The victims were believed to be five Italians on the sightseeing helicopter trip, and a parent and child in the Piper plane that was heading for the Atlantic seaside resort of Ocean City. Both pilots were also feared dead.
Shocked tourists on the ground watched in horror as both aircraft broke apart and disappeared beneath the surface of the water.
Although emergency services and leisure boats launched an immediate rescue operation, Mayor Michael Bloomberg said the crash was "not survivable".
Divers were searching the riverbed, at depths of 30 feet and with visibility of just two feet, for wreckage and bodies.
According to eye-witness reports, it appeared that the helicopter had just taken off from a mid-town helipad and turned south down the river when the plane smashed into it, shearing off a rotor. Both aircraft shed debris as they plummeted into the water.
There were unconfirmed reports that the plane may have lost part of a wing just before the smash. It had taken off from Teterboro, a private airport in New Jersey, a few minutes earlier.
The helicopter belonged to Liberty Harbour Sightseeing Tours which runs popular aerial tours of major New York landmarks such as the Statue of Liberty. The weather conditions were clear and calm at the time of the crash just before midday.
In January, a US Airways jet with more than 150 people on board crash-landed into a nearby stretch of river off Manhattan after apparently hitting a flock of geese. All aboard survived in what became known as the "miracle on the Hudson".
Two years ago, a Liberty helicopter fell 500 feet from the sky into the same river during a sightseeing trip. The pilot was credited with safely landing the chopper on the water and helping evacuate her seven passengers.