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The incident took place at Lighanwala Chowk in Sri Hargobindpur in Batala on Sunday night. There were 13 people in total in the two groups and all of them hail from village Vithwan here.
Two persons from each group died in the firing, said Batala Senior Superintendent of Police Ashwini Gotyal.
The deceased have been identified as Balraj Singh, Shamsher Singh, Baljit Singh and Nirmal Singh.
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The injured are stated to be out of danger, said the police.
Multiple rounds were fired in the incident, the police, adding they recovered 30 live rounds and empty shells from the spot.
The SSP said one group was led by Major Singh and the other faction by Angrej Singh. Both Major and Angrej had a dispute over the distribution of water from a water channel for irrigation in their fields.
The police said both the factions had a fight in the heat of the moment on Sunday night.
One faction comprised nine people and another group had four people, said the SSP.
After getting information, a police patrolling team, led by the station house officer, reached the spot immediately.The vehicle of the SHO was also hit by a bullet, said the SSP. An FIR has been registered and further investigation is underway, the police said.