Fighter jets were scrambled over US cities and New York authorities heightened security alert levels over fears of a terrorist attack, after the plane smashed into the higher levels of a building in the Manhattan's wealthy upper east side.
The plane, a Cirrus SR20, was registered to Lidle, 34, a player with the New York Yankees baseball team. His death was confirmed by the owner of the team.
The other victim was reportedly Lidle's flying instructor.
Aviation officials are still investigating the cause of the crash, and it was not clear who was piloting the plane when it crashed into the residential tower at around 2.45pm (1845 GMT) and burst into flames, showering the streets below with debris.
Investigators told CNN news channel that the pilot had issued a distress call mentioning fuel trouble shortly before the crash.
At least 20 people, most of them firefighters, were injured, although only two were taken to hospital, city authorities said.
In response to the incident, Admiral Tim Keating - commander of the US Northern Command, said that the US military had scrambled fighter jets above some US cities as a precaution.
However Michael Bloomberg, the mayor of New York, said there were no signs of terrorism.
"I just stood there in shock, I thought 'this can't behappening to us again'"
Witness to plane crash
"Sadly an accident like this cost two people their lives, but I don't know that there's any greater significance," he said.
The incident revived memories of the September 11 attacks in New York and Washington in 2001 for many in the city.
"I just stood there in shock, I thought 'this can't behappening to us again'," one resident told AFP news agency.
"It was like 9/11 all over again."