Four people have been arrested in connection with a fatal fire that swept through a Santa Maria nightclub, killing 231 people, as families of the victims held funerals for the deceased.

The club owners and two members of the band performing there at the time of the fire were arrested on Monday, police confirmed.

No charges were filed against the men, but prosecutors said they could be held for up to five days as police press them for clues as to how the fire early Sunday morning could have caused so many deaths.

Stunned residents in the southern city of Santa Maria attended a marathon of funerals beginning in the pre-dawn hours. As sunset approached, friends and family members readied for a candle-lit procession through the streets of the city.

While relatives bury the dead, as many as 74 survivors "in critical condition" and with serious skin burns remain in the hospital, Al Jazeera's Gabriel Elizondo, reporting from Santa Maria, said.

Meanwhile, investigators are now looking into reports of overcrowding inside the club, Elizondo said.

He said there were reports that as many as 1,000 to 2,000 people in their 20s were at the club when the fire broke out.

During a performance, a band member set off a pyrotechnic machine that is believed to have triggered the blaze.

Some witnesses also claimed that security at the club, who may have not been aware of the fire, initially shut down the main entrance to prevent the crowd from leaving without first settling their bar tabs, Elizondo said.

Cleberson Braida Bastianello, police major, said officials counted 231 bodies that had been brought for identification to a gymnasium after the blaze erupted early on Sunday. Eighty-two people were also hospitalised with injuries, and 75 of them were in serious condition, officials said.

Bastianello said that the death toll had been lowered from the 245 earlier believed killed at the Kiss nightclub.

Major Gerson da Rosa Ferreira, who was leading rescue efforts at the scene for the military police, said the victims died of asphyxiation or from being trampled.

The identification process of the bodies had been completed by early Monday, reported Al Jazeera's Teresa Bo from Santa Maria.

Underage visitors

Investigations suggested that there was only a single exit door in the crowded nightclub, and that in the confusion immediately after the fire broke out, it was initially shut by staff, she said.

Santa Maria is near the borders with Argentina and Uruguay, about 300km west of the state capital of Porto Alegre.Authorities also say that many of those who died were between 16 and 20 years old, and were reportedly allowed inside the club even though they were underage, Al Jazeera's Bo said.

Luiza Sousa, a civil police official in Santa Maria, told Reuters news agency that the blaze started when a member of the band or its production team ignited a flare that then set fire to the ceiling, which was apparently covered with insulating foam.

The fire spread "in seconds", Sousa said.

Sandro Meinerz, a police inspector, told the Agencia Estado news agency that manslaughter charges could be filed against the band, at least one of whom died in the fire, or their crew.