Police were called to the property at around 7.30am on Friday after locals expressed concern for the welfare of those inside.
Yorkshire Ambulance Service and Yorkshire Air Ambulance raced to the scene and transported six children to hospital.
Six children taken to hospital after serious incident in Sheffield
A spokesman for South Yorkshire Police said there would a large number of officers in the area throughout the day as inquiries continued.
Six children are taken to hospital as police cordon off primary school
The incident took place close to the Hartley Brook primary school and witnesses reported seeing an air ambulance land in the grounds of the school.
Local residents claimed they had seen two children being taken out of the house by paramedics before being rushed away in an ambulance.
There were initial reports that the incident involved firearms, but South Yorkshire police denied that there had been a shooting.
A statement issued by South Yorkshire Police said: "Police were called at around 7.30am today to reports of concerns for safety at a property on Gregg House Road, Shiregreen.
"Yorkshire Ambulance Service and Yorkshire Air Ambulance have attended and transported six children to hospital.
"There will be a significant police presence at the scene throughout the day as officers continue enquiries.
"A cordon is in place and buses are being diverted from the area. This incident is ongoing and further updates will be provided in due course."
It is understood the youngsters were taken to The Sheffield Childrens Hospital in the Broomhill area of the city.
Six children have been rushed to hospital after a serious incident near a school in Sheffield this morning.
Police say two people have been arrested after the incident which took place at a property Gregg House Road, Shiregreen, at around 7.30am.
Witnesses said they saw two children being taken out of a home in bandages and being put into a road ambulance while a man and woman were seen in handcuffs.
An air ambulance landed at nearby Hartley Brook Primary Academy, which has been cordoned off by officers, and has since left the scene.
Police and forensics teams are continuing to conduct inquiries while worried residents have been gathering in nearby roads.
Officers are currently going from door to door and were initially called to the scene over reports of concerns for safety at the property.
Six children have been rushed to hospital this morning after a serious incident near a school in Sheffield. Forensic teams have since been pictured going into a house in Gregg House Road, Shiregreen
Several houses have been blocked off by a cordon, pictured, and police say they are expecting to be on the scene throughout the day
Police have cordoned off streets and a bus can be seen behind the tape, although it is understood it is not a school bus
An air ambulance has landed at Hartley Brook Primary Academy in Sheffield this morning, pictured, after the incident
Residents at the scene say at one time there were four ambulances and seven police cars here plus the Yorkshire Air Ambulance #Sheffield pic.twitter.com/MHJ5MXQhsP
One resident, who asked not to be named, said she was told by police the incident was possibly domestic-related.
The 41-year-old mother-of-three said: They came to the door and just asked if I knew the people, did I hear anything through the night.
I dont really socialise with my neighbours but its a fairly quiet street. Its the last thing you expect to wake up to.
Another resident, 29-year-old Aaron Brunskill, told how neighbours reacted with shock as children were brought out from the property and into waiting ambulances.
Officers were called to reports of concern for safety in Shiregreen, Sheffield, pictured, at around 7.30am
The property is just yards away from Hartley Brook Primary Academy and parents were struggling to get their children into the school, pictured
Police have been arriving at the scene throughout the day including uniformed officers and detectives
Police have yet to confirm the exact nature of the incident but two adults have been arrested. Pictured is a forensics officer outside the property
The neighbours told me it was children, there was a small toddler less than two years old taken away in another ambulance, I dont know if they were injured.
Mr Brunskill said the street was not usually noisy but police would often be seen dealing with incidents at properties.
People say you never expect it to happen on your front door step and we dont. We didnt know what it was to do with. I have not seen the amount of police like it before.
Police have also been going door to door in the area, as well as conducting forensic searches, pictured
Officers have been seen standing guard outside a house in the road, pictured, while witnesses said two children were taken out of a property in bandages
The exact nature of the incident is still unknown but it is understood it was not a shooting. Pictured are plain clothed police officers behind the cordon
A police statement said: Police were called at around 7.30am today (24 May) to reports of concerns for safety at a property on Gregg House Road, Shiregreen.
Yorkshire Ambulance Service and Yorkshire Air Ambulance have attended and transported six children to hospital.
There will be a significant police presence at the scene throughout the day as officers continue inquiries.
A cordon is in place and buses are being diverted from the area. This incident is ongoing and further updates will be provided in due course.
Yorkshire Ambulance Service said it was not commenting on the condition of the children and said South Yorkshire Police was dealing with the incident.