About 25 people were taken to hospital and hundreds of homes were damaged in the overnight fire, officials said.
Shells detonated by the blaze caused windows as far as 10km (6 miles) away to shatter.
The arms depot, which stored artillery shells and rockets and and ammunition, is in the Udmurtia region of the western Urals, 900km east of Moscow.
Some reports suggest the blaze may have been sparked by a discarded cigarette.
The fire has interrupted the flow of oil along a nearby pipeline.
Second in a weekEmergency teams have flown from the Russian capital to the scene where firefighters are battling the blaze.
Officials said that more than 500 people were battling the blaze, using four planes, three helicopters and robotic equipment.
Earlier on, balls of fire rose from the depot, according to eyewitness accounts.
There were two or three loud blasts every minute, a defence ministry official said.
Two elderly people living near the depot have died of heart attacks said Elena Ivanova, a spokeswoman for the regional health ministry in Udmurtia.
It was not clear if the deaths were linked to the explosions or the fire.
"There was an explosion and then a fire. The windows shattered and everything shook," a resident, Klara Taufikovna, told a Russian news website.
"We were all very frightened, we didn't know what to do, where to run or even what happened."
This is the second time in a week that a Russian ammunition dump has exploded.
An arms depot caught fire in the Russian region of Bashkiria at the end of May.
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