Officials said a rifle was recovered from the scene. A hospital spokesperson reported 31 people were injured, higher than the initial count of 24 from officials.
Police said they were searching for a white male about 18 to 20 years old and asked the public for tips and cellphone images and surveillance video to help find him. They did not have a motive for the shooting.
"We are aggressively looking for the individual who's responsible," sheriff's department spokesperson Christopher Covelli told journalists. "He could be in the city. He could be somewhere else."
The investigation has made "significant progress," he said without elaborating, except to say that the shooting took place from the rooftop of a business that the gunman reached via an alley ladder attached to the building that was not secure.
The shooting comes with gun violence fresh on the minds of many Americans, after a massacre on May 24 killed 19 school children and two teachers at an elementary school in Uvalde, Texas, and the May 14 attack that killed 10 people at a grocery store in Buffalo, New York.
President Joe Biden said he and his wife Jill were "shocked by the senseless gun violence that has yet again brought grief to an American community on this Independence Day."
Biden said he had "surged federal law enforcement to assist in the urgent search for the shooter."
In his statement, Biden referred to bipartisan gun-reform legislation he signed recently but said much more needed to be done and added: "I'm not going to give up fighting the epidemic of gun violence."
Staff at NorthShore Highland Park Hospital in Highland Park were treating 26 people and five were transported to NorthShore Evanston Hospital. "The vast majority suffered gunshot wounds," spokesperson Jim Anthony said.
'MY GOD, WHAT HAPPENED?'
Children waving American flags, riding tricycles or enjoying a ride in a wagon pulled by adults froze as people in the crowd screamed while gun shots rang out, video on social media showed.
One cellphone video, seen but not verified by Reuters, recorded what sounded to be about 30 rapid shots, a pause, and then another roughly 30 shots. Between the two bursts, a woman can be heard saying from the side of the parade route: "My God, what happened?"
Amarani Garcia, who was at the parade with her young daughter, told the local ABC affiliate she heard gunfire, then a pause for what she suspected was reloading, and then more shots again.
There were "people screaming and running. It was just really traumatizing," Garcia said. "I was very terrified. I hid with my daughter actually in a little store. It just makes me feel like we're not safe anymore."
Social media video showed a marching band suddenly breaking formation and running away, and other images of people leaving their belongings behind as they sought safety.
"Everyone was running, hiding and screaming," said CBS 2 Digital Producer Elyssa Kaufman, who was at the scene.
A 36-year-old native of Highland Park who wanted to be identified only as Sara, told Reuters she had attended the annual parade most years since her childhood.
"Not even five minutes after, very shortly after, the police and firetrucks part of the parade had gone by I heard 'pop, pop, pop, pop, pop,'" she said, adding that she first thought they were muskets some times used in parades.
"I looked and there were no muskets. The popping didn't stop ... again it went 'pop, pop, pop, pop, pop' and I turned and I said 'those are gun shots, run!'"
Highland Park's population is 30,000 and nearly 90% white, according to the U.S. Census Bureau. About a third of the population is Jewish, according to the Jewish Telegraphic Agency.
At least one of those killed was a Mexican national, a senior Mexican Foreign Ministry official said on Twitter.
The shooting is likely to rekindle the American debate about gun control, and whether stricter measure can prevent mass shootings that happen so frequently in the United States.
After the Uvalde and Buffalo shootings, Congress last month passed its first major federal gun reform in three decades, providing federal funding to states that administer "red flag" laws intended to remove guns from people deemed dangerous.
It does not ban sales of assault-style rifles or high-capacity magazines, but does take some steps on background checks by allowing access to information on significant crimes committed by juveniles.
(Reporting by Eric Cox; Additional reporting by Brendan O'Brien and Caroline Stauffer in Chicago; Chris Gallagher, David Brunnstrom and Chris Bing in Washington; and Daniel Trotta in Carlsbad, California; Writing by Daniel Trotta; Editing by Mary Milliken, Bill Berkrot and Lisa Shumaker)
By Eric Cox and Brendan O'Brien
