The 22-month-old girl was playing with family and friends on Thursday evening when the tragedy happened.
The 18-year-old driver of the milk float was arrested on suspicion of dangerous driving and has been bailed pending further inquiries.
The incident happened on Vickerman Street, a small road off Hopwood Lane, at around 5.30pm.
Isha Khatoon, 33, who witnessed the collision, said: “I was walking home from my mum’s house and I saw the truck reverse back and the little girl was on the floor. She looked very bad, she wasn’t conscious.”
Local resident Zaheer Hussain, 28, said: “There were a fair few kids playing out on the street. You couldn’t exactly miss them.
“The milk float had two people in it but apart from that it was empty, no one in the street even gets milk. I think they were just looking for scrap metal.
“Everyone went running out and I took the key out of the ignition to make sure they stayed there. By then the whole street was out and the police.
“She was unconscious until we got her into the ambulance and then her leg moved. Then the air ambulance came and they resuscitated her. You can’t even describe how it felt to see her like that. We didn’t know if she was alive or not at that point because she wasn’t moving at all.”
The little girl was airlifted to Leeds General Infirmary with head injuries but died a short time later.
Witnesses are asked to contact Sgt Gary Alderson on 01924 293047.