Hospital sources reported 39 people have died, though provincial authorities confirmed around 25 deaths.
Officials said the stampede broke out on the streets of Nashik, a small town some 300 north of Mumbai, as many of the million pilgirms surged forward for a holy dip in river Godavari during the famous Hindu festival of Kumbh Mela.
Eyewitnesses say the path to the river used by pilgrims is narrow causing people to push, jostle and shove each other.
Rescue workers were further hampered by the sheer volume of pilgrims making it difficult for ambulances to reach the injured.
"My latest information is that it could be at least 25 dead and more than 30 injured," Maharashtra's Home Minister Kripashankar Singh said.
The state's deputy chief minister, Chhagan Bhujbal, said the stampede broke out when worshippers crammed into a narrow road on their way to the riverbank.
He said 15 to 20 people were crushed in the stampede and around four worshippers drowned at the shrine on the Godavari river.
Held every three years in different parts of India, millions of Hindus are taking part in this year's Kumbh Mela in Nashik.
The current festival opened on 30 July and continues until the first week of September.
The local authorities had earlier claimed to have made elaborate arrangements to cope with the crowd.