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The National Agency for Food, Drug Administration and Control said it had shut down the Lagos-based manufacturer, Barewa Pharmaceuticals.
It said the syrup, called My Pikin, had been tainted with diethylene glycol.
The substance, used in engine coolant and anti-freeze, triggered kidney failure in the children, it said.
The children died at three hospitals in Lagos, Ibadan and Zaria.
At least 10 other children are reported to have been brought to hospital.
The NAFDAC said symptoms among the children who had taken the syrup included diarrhoea, vomiting, fever and convulsions, and that they had not been able to pass urine for several days.