Police called to a “fear-for-welfare” incident saw a black BMW convertible linked to the call-out.
As the BMW travelled in Purley on Thames, Berkshire, at 9pm on Thursday night, it collided with two cyclists who died at the scene.
One of the riders was named locally as 29-year-old father-of-two John Moorland.
His mother-in-law, who gave her name only as Janet, later left a bouquet of red and white flowers at the scene.
She said her daughter was too upset to speak. “My daughter’s in bits and the children, too,” she said.
The woman said the other cyclist was named Chris and was a father of five.
A man has been arrested over the incident as the police watchdog, the Independent Police Complaints Commission (IPCC), said it was carrying out an assessment.
One local resident said he saw a flash of light and when he looked out, he saw two bodies lying on the ground outside his house.
The man, who did not want to be named, said: “I’ve been told it was a police chase. The car rolled over and ended up outside the house and someone was being cut out of it. I didn’t do anything as the police were already here.”
The man added that it was an accident blackspot with many crashes at the scene before.
A bent signpost and two traffic bollards with displaced earth beneath could be seen at the side of the road where the accident happened.
A bicycle seat and other debris could be seen in bushes to the side of the road, which has a 30mph speed limit.
A spokesman for Thames Valley Police said: “The BMW collided with two cyclists, who both died at the scene.
“Specialist officers are currently in the process of informing and supporting their next of kin.”
The force said it had referred the incident to the IPCC. The BMW’s driver was injured and taken to the Royal Berkshire Hospital in Reading.
Purley on Thames is one of the areas worst hit by the flooding in the Thames Valley.
Labour leader Ed Miliband visited the village earlier this week and urged the government to put pressure on insurance companies so flood victims do not have to wait for payouts.
Bill Ayling, a long-serving councillor on Purley on Thames Parish Council, said the road where the incident happened is on a hill and would not have been flood-affected.
He said: “I’m absolutely shocked. I know the road very well. It is well lit at night and it’s up on a hill, so I know it would not be flooded up there.”
Parish council chairman Rick Jones said: “Reading is nearby and car crime is a normal occurrence in areas like that.
“I do know of cars being stolen and police chasing them, and that road where the incident happened lends itself to cars travelling fast.
“It’s a shock. It’s a very quiet village normally.”
An IPCC spokeswoman said: “We sent investigators to the scene and we are carrying out an assessment.
“Our people on the ground are looking into the circumstances and in time will decide the level of IPCC involvement.”