Witnesses said soldiers opened fire in the southern district of Kulgam after hundreds of people angry at an army search operation for suspected militants gathered in protest, some hurling objects.
A government doctor said that the dead included two men aged 20 and 22 years and a 16-year-old girl.
“The three had bullet injuries and succumbed soon after their arrival at the hospital,” the doctor at a sub-district hospital in Kulgam said on condition of anonymity.
Police chief S.P. Vaid confirmed the deaths.
The killings come on the eve of the second death anniversary of Burhan Wani, a charismatic 22-year-old freedom fighter killed by government forces two years ago on July 8.
Kashmiri leaders have called for a shutdown on Sunday to commemorate Wani’s death.
Wani’s killing has triggered a sustained wave of protests that have so far claimed the lives of at least 100 civilians, with last year the deadliest in the region for the past decade.
Thousands of others were injured by shotgun pellets fired by the Indian army.
India has about 500,000 soldiers in the part of Kashmir it controls, where armed groups are fighting for independence or a merger with Pakistan.
Last month, the UN human rights chief released a report, calling for an investigation into alleged abuses perpetrated by Indian security forces in Kashmir.