Three of the workers were taken to Markham Stouffville hospital, Durham Regional Police told CBC News. There were reports that one person was moved to another hospital, but the second location has not been confirmed.
The fourth man was injured but not seriously, Durham Regional Police said on Wednesday evening.
The explosion happened in a part of a 30-kilometre-long sewer line under construction.
The workers were reportedly digging at a depth of about four meters when a methane detector triggered an alarm.
As the workers began to evacuate the tunnel, there was some kind of flash, a statement from York Region Communications said late Wednesday.
Police said the workers "encountered a methane pocket" and that "a small explosion occurred."
Officials said the tunnel did not collapse, despite earlier reports, and that evacuation safety protocol procedures had been followed.
The incident happened northeast of Toronto, where Concession Road 4 in Pickering meets the Markham Townline Road, police said.
The Ontario Ministry of Labour has been called in to investigate.