England cyclist Matt Walls crashed into the crowd during the final lap of the men's 15km scratch race, leaving one young fan "covered in blood".
Medical teams rushed onto the track and the race was abandoned as a second cyclist, Matt Bostock from the Isle of Man, was taken away on a stretcher.
One fan had to be helped away in a wheelchair after Walls landed in the crowd and was "covered in blood", according to The Sun.
The Lee Valley VeloPark in London, one of the venues for Birmingham's Commonwealth Games, was cleared of fans and all racing stopped.
The 24-year-old Olympic champion was trying to avoid riders who had fallen in a crash lower down the banking but as he rode up, he clipped another wheel and went over the top.
He was treated by medical teams onsite for 40 minutes.
"Matt is alert and talking (as he has been throughout) and is being given medical attention in hospital," a Team England spokesperson said.
Bostock was also given a CT scan from which the initial prognosis was said to be positive. The 25-year-old was being assessed to check he had no other serious injuries.
Witnesses said that, because of the gradient of the banking, spectators in the front row had been unsighted for the crash.
One man received treatment for cuts to his arm while a young girl also received minor attention. The spectators did not require hospital treatment.
Eight riders in total went down in the crash on the last lap of the race, with medics and coaches immediately rushing to trackside. One England coach climbed up the banks of the velodrome to reach Walls in the crowd.
The remainder of the morning session at the velodrome was cancelled and spectators were asked to leave as medical staff attended to Walls.
Canadian Mathias Guillemette was disqualified from the race for causing the initial crash.
British Cycling tweeted shortly after the crash: "Following a crash in the men's scratch, Matt Walls & Matt Bostock are being treated by medics before being taken to hospital for further treatment.
"We send our best wishes to the riders and spectators involved in the incident, and will provide a further update when we can."
Welsh Cycling added: "Sending our love and best wishes to those injured in the crash at the Velodrome today. On behalf of all of us at Welsh Cycling we hope for a speedy recovery.
"We can confirm that Will Roberts is ok, and was not involved in the accident."
Scottish cyclist Kyle Gordon was also "taken down" but recovered and got back up and onto his bike.
The crash comes after England cyclist Joe Truman was knocked unconscious in a separate collision on Saturday when riding at 45mph, suffering a broken collarbone as he hit the hard flooring.