If convicted, the suspect, 21-year-old Robert E. Crimo III, would face a maximum sentence of life in prison without the possibility of parole, Illinois state attorney Eric Reinhard said while announcing the charges at a news conference.
The prosecutor said the first-degree charges were likely to be followed by dozens of additional indictments before the investigation is over.
He said he would ask that Crimo remain in custody without bail at the suspect's first court appearance on Wednesday.
Authorities said Crimo had planned the attack for weeks and had come to the attention of authorities at least twice before after reports he threatened suicide or harm to others, local officials said on Tuesday.
Authorities said the suspect fired more than 70 rounds from a rooftop at random onto people watching Monday's Independence Day parade in Highland Park, Illinois.
He made his getaway dressed in a disguise to blend in with the panic-stricken crowd, authorities said on Tuesday.
The suspect surrendered to police on Monday, hours after the attack that left seven people dead more than 30 others wounded.
Police revised the confirmed casualty toll on Tuesday with the death of a seventh person who had been hospitalised.
Crimo has distinctive facial tattoos, and wore women's clothing on Monday in an apparent effort to mask his identity, Chris Covelli, a spokesman for the Lake County Sheriff's office, told reporters.
"He blended right in with everybody else as they were running around, almost as if he was an innocent spectator as well," Covelli said.
Officials had earlier said the suspect was 22, but corrected that to 21 at Tuesday's briefing.
The suspect fled to his mother's house nearby, and later borrowed her car.
Officials said they did not know the motive for the shooting in a neighbourhood with a large Jewish population. There was no immediate evidence of any anti-Semitic or racist basis.
The suspect used a high-powered rifle for the attack, similar to an AR-15, which he dropped at the scene.
He had a similar rifle in his mother's car, which he was driving when taken into custody by police, and owned other guns at his home, all of which were bought legally in Illinois, officials said.
Highland Park Mayor Nancy Rotering said she knew the suspect when he was a little boy and a cub scout and she was a cub scout leader.
"What happened? How did somebody become this angry, this hateful?," she said.
Rotering said on Tuesday she did not know where the gun the gunman used came from but added that it was legally obtained.
"Our nation needs to have a conversation about these weekly events involving the murder of dozens of people with legally obtained guns," she said.
The suspect's father, Bob Crimo, ran Bob's Pantry and Deli in Highland Park for at least 18 years, according to a Chicago Tribune business profile.
Bob Crimo closed the deli in 2019 before he unsuccessfully ran against Rotering for mayor of Highland Park.
