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Federal authorities deployed thousands of paramilitaries and blocked mobile internet access in the region to counter the protesters.
Local police, who joined the paramilitaries in clashes with demonstrators breaking curfew in Guwahati, in Assam state, opened fire on the crowd with both blank and live rounds.
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India's Citizenship Amendment Bill (CAB), passed by the upper house of parliament on Wednesday, allows for the fast-tracking of citizenship applications from religious minorities from three neighbouring countries, but not Muslims.
Protests in India as Modi-led govt pushes for anti-Muslim citizenship bill
The two demonstrators killed by police were among a large group being treated for various wounds at Guwahati Medical College and Hospital.
"A few of those people were brought in with bullet injuries. Two of those 21 people have died," said Ramen Talukdar, a doctor at the hospital.
Separately, security was increased at the consulate of Bangladesh in Guwahati after a vehicle in the consul's convoy was attacked Wednesday by mobs protesting the bill's adoption, the foreign ministry in Dhaka said in a statement late Thursday.
Bangladesh "believes that the attack on the convoy" and the vandalization of signposts near the consulate "is a one-off incident," the statement read.
For Islamic groups, the opposition, rights groups and others in India, the new law is part of Prime Minister Narendra Modi's Hindu-nationalist agenda to marginalise India's 200 million Muslims. He denies this allegation.
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But many in India's far-flung northeast object because they fear the legislation, which prompted angry exchanges in parliament this week, will give citizenship to Hindu immigrants from Bangladesh.
Five thousand paramilitary troops were deployed in Guwahati, while many roads and highways were blocked to prevent the spread of protests.
Officials said 20 to 30 people have been hurt in the demonstrations in recent days, with vehicles torched and police firing tear gas and charging the crowds with wooden staffs.
Guwahati's top police officer, Deepak Kumar, was removed from his post and replaced over the outbreak of violence, authorities said.
All train services to Tripura and Assam were suspended and some flights were cancelled. Several cricket and football matches scheduled to be played in Assam were also called off amid the curfew.
Without citing the unrest, Bangladesh home minister Asaduzzaman Khan postponed his Friday visit to the northeastern Indian state of Meghalaya, his spokesperson Sharif Mahmud Apu told AFP.
"He will visit Meghalaya at a later time," Apu said, without giving a reason.
Modi sought to calm the situation in a series of tweets that many in the region could not read because mobile internet was mostly blocked.
"I appeal to the northeast, to Assam and every other state - every community there - to assure that their culture, traditions and language will keep getting the respect and support," he said at a rally at eastern Jharkhand state.
"Assam is not a dustbin so that central government will keep on dumping whoever they want in Assam," Assamese film actress Barsha Rani Bishaya said in Guwahati at a meeting of film and student bodies.
"People of Assam have woke up... this time and they will not accept the CAB."
Several leaders from Modi's ruling Bharatiya Janata Party (BJP) in Assam have also resigned in opposition to the legislation.
Meanwhile, Bangladesh Foreign Minister A.K. Abdul Momen cancelled a trip to New Delhi hours before he was due to arrive Thursday, citing domestic engagements.
He had on Wednesday pushed back against the Indian government's claims the legislation was meant to help those persecuted in Bangladesh, Pakistan and Afghanistan, telling local media his country did not oppress minorities.
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It is not yet clear if the legislation, after being signed off by the president, would survive a constitutional challenge in the Supreme Court.
The Indian Union Muslim League filed a petition in the top court, with the political party's leader saying it was against the basic principles of the country's constitution.
India’s parliament approves citizenship law for non-Muslim minorities
"The constitution says there will be no differentiation based on caste, religion or anything. Here, the citizenship is being given on the basis of religion," P.K. Kunhalikutty told AFP.
"The CAB... won't stand in front of the law."
The petition states that they "do not have any grievances in granting citizenship to migrants but the petitioners grievances are directed against discrimination and unreasonable classification based on religion."
Amnesty International said the law was "bigoted" and called for it to be immediately repealed.
"In a secular country like India, slamming the door on persecuted Muslims and other communities merely for their faith reeks of fear-mongering and bigotry," the global rights groups said in a statement Wednesday.
"They also run absolutely foul of India's international obligations."
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