The girl, identified as Wynter Larkin of Yeadon, Pa., was at the store with her mother for a fundraising event sponsored by a fraternity, Omega Psi Phi, and a sorority, Alpha Kappa Alpha. The mother is a member of the sorority.
Witnesses said the metal security gate was rolled up into its steel container, which crashed down, hitting the toddler. Police estimated the weight of the unit at about 2,000 pounds.
City officials ordered the store closed until the gate has been repaired.
A man who was at the event told the Philadelphia Inquirer he and more than 20 others lifted the gate off the girl and held it up for about 20 minutes.
"You could see the imprint on her face," the man said. "I was lifting the gate and I'm looking down at the girl. Clearly she was unconscious. Her eyes were open and there was blood."
Larkin was pronounced dead at Hahnemann Hospital.
Rita's Water Ice is a regional franchise chain operated by Rita's Italian Ice. The owners of the franchise, Kenneth Jackson and Rebecca Cooper, belong to the fraternity and sorority, which were raising money for scholarship funds.
Alpha Kappa Alpha and Omega Psi Phi were the first Greek organizations founded at historically black colleges.
Linda Duke, a spokeswoman for the parent company, issued a statement of condolence: "Our hearts and prayers go out to the child's family."