The accident happened around 7:00 a.m. in the area of 4th and Franklin streets.
Police say an ambulance was responding to an emergency call when it collided with a school bus that was transporting students to St. Mark's High School.
The school bus was traveling northbound on North Franklin Street with approximately nine children on board during the collision.
The ambulance struck a fire hydrant before catching fire and trapping the two medical technicians inside.
The technicians were rescued and taken to Christiana Hospital for treatment of non-life threatening injuries.
One student was treated at St. Francis Hospital for minor injuries and released to their guardian.
Other students refused treatment and waiting for another bus to pick them up.
Action News was told, there may have been a third vehicle involved.
Police are investigating.