Fire and emergency services responded to the collision between the two planes from Sunwing Airlines and Westjet Airlines, which happened at 6:19 p.m. (2319 GMT), the Greater Toronto Airport Authority said in a statement.
WestJet said an inbound flight from Cancun, Mexico, with 168 passengers and a crew of six was stationary and waiting to go to a gate when it was struck by a Sunwing aircraft moving back from a gate.
The empty plane's wing burst into flames after the collision, causing panic among passengers on the WestJet aircraft.
Around two hours after the crash, WestJet sent out a tweet that said, "Guests are safely in the terminal and they are in the process of clearing customs".
'We are aware of an incident that occurred shortly after 6pm this evening at Toronto Pearson Airport where a Sunwing aircraft, under tow by our ground handling service provider, came into contact with another aircraft.
The fire was quickly extinguished by emergency responders at Canada's largest airport.
When the incident happened, the temperatures in the city were as low as -21 C, making the evacuation more hard.
The Transportation Safety Board was onsite at Toronto Pearson Friday to investigate the collision, the airport confirmed.
Airport officials said that flight operations "have not been significantly affected by the incident", although the airport was struggling due to plunging temperatures that reached almost -20 degrees Celsius (-4 Fahrenheit) overnight on Friday.
Amid the screams, one person yelled: 'Calm down, that's not our plane on fire'.
'Out of nowhere there was an audible crunch and the plane rocked slightly, ' reports CBC News.
'After a couple of seconds the entire thing ignited and it was chaos inside the plane.