Suleiman Ali, 26, of Toronto, and Warsame Ali, 26, of Vaughan, were found in a laneway behind Jamestown Crescent, near Finch Avenue West and Martin Grove Road.
The victims are not related, police say.
Police were called after residents reported hearing gunshots after 1 a.m.
One neighbour told CBC News she heard four to five shots in the middle of the night.
The two men were found a short time later in the laneway. Both had been shot in the head and were pronounced dead at the scene.
Post-mortem examinations have been scheduled for both victims on Wednesday.
Police say they are now seeking a black male suspect five feet 10 inches tall, who was last seen wearing a black hoodie. He fled the scene on foot.
Both victims are believed to be of Somali descent, bringing to six the number of Somali men who've died as a result of gun violence since the start of June 2012.
The slayings mark Toronto's 39th and 40th homicides of 2012.
Many residents who live near the site of Tuesday's double shooting refused to speak with CBC about what they may have seen or heard.
"I'd rather keep my mouth shut," one resident told CBC News. "That way I'll live to see tomorrow."
Police are investigating whether the shooting is connected to the Jamestown Crips.
Police believe the notorious street gang is responsible for a number of high-profile shootings in the area, including one in 2008, when a gang member shot 22 bullets into a housing project, killing Darnell Grant a father and innocent bystander.