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Witnesses said the horizontal arm of the crane in use at the Upper East Side construction site began to circle and then snapped off, propelling the cab and the upper portion of the arm onto a white-brick residential building across the street, The New York Times said.

The falling cab demolished a portion of a 22nd-story penthouse, then plunged down the north facade, shearing off balconies, landing at a drug store on the street level.

The incident occurred about two months after a tower crane collapsed on East 51st Street between Second and First avenues, killing seven people and prompting an extensive review of the safety of cranes in the city.

The operator of the crane, Donald Leo of Monmouth Beach, N.J., was killed. He had been sitting in the cab as the structure fell. Also killed was Ramadan Kurtij, 27, of the Bronx.

Mayor Michael R. Bloomberg, who spoke at a news conference two hours after the collapse, said no one in the building was injured. A pedestrian suffered minor injuries.

Investigators were trying to determine whether a bad weld was responsible for the top of the crane snapping, a city official said.

Authorities ordered the evacuation of several nearby buildings containing more than 200 apartments. By Friday evening, residents were permitted to return to all the affected buildings but one -- 354 East 91st -- the Times said.

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