Police said the shooting occurred at 11:20. Medina and Gorman died at the scene.
Investigators said they do not yet know the motive for the killing or the nature of the dispute.
Medina has a history of drug arrests and recently was sentenced to two to six years for possession of PCP with intent to distribute, according to court records.
At a news conference Wednesday at Police Headquarters, Capt. James Clark, commanding officer of the Homicide Unit, said authorities are concerned there might be retaliation for the shootings. Additional officers are patrolling the neighborhood. Police said they are seeking help from the public in locating the gunman.
The man was described as heavyset, about 6 feet, 2 inches tall, bald, with a full beard. Police said he was last seen running east on Gurney after the shooting.
About a dozen people gathered Wednesday afternoon at Swanson Street and Gurney, the site of the killing. Neighbors placed candles on the ground and tied balloons to a telephone pole. On a poster board, they wrote messages to Gorman and Medina, calling her by her nickname, China.
Family members said Medina's son is being cared for by a close family friend. He was not physically injured, police said.
"That little boy is going to be traumatized," said a woman who declined to give her name but said she was an aunt.
Neighbors said Medina's death was the second fatal shooting this year in that part of Kensington.
"We don't feel safe," the aunt said. "To have to walk to the store and have to watch your back, it's just not fair."
"Nobody loves each other anymore," said another family member.
Police said the boy and the unidentified woman in the car had been assisting police with details of the crime.
Medina was arrested twice in 2008 for possessing the controlled drug PCP, also known as angel dust, with intent to distribute.
Both times, she pleaded guilty, court records show. On June 11, 2010, she was sentenced to two to four years for one criminal complaint, and two to six years for the second. The sentences were to be served concurrently.
It was unclear late Wednesday where she served her sentence or when she was released.
Medina also had been arrested on drug charges in 2002, 2003, and 2004, according to court records.
Last Friday, Medina was arrested for disorderly conduct. Police said she was standing in the middle of the 2800 block of Swanson in the afternoon, yelling at people. Police tried to calm her down. Her lip, according to the complaint, was cut by a blow from an unknown man. After being taken to the hospital, Medina was cited by police and released.
Gorman was charged with driving under the influence on Oct. 21, 2012, and March 12, court records show.
Police ask that anyone with information about the double slaying call 215-686-3334. A $20,000 reward is being offered.
The unidentified aunt said Medina lived on Swanson as a child, not far from where she was shot.
The woman said the last time she spoke to her was at a store three days before. She said Medina seemed irritated, but hugged her and said she was working and doing well.
Contact Jennifer Lin at 215-854-5659 or firstname.lastname@example.org, or on Twitter @j_linq.