The blast took place in Tank Adda in the city near a police van, injuring 20 people who are being shifted to a nearby hospital. Some of the injured are in critical condition, reported Geo News.
Gunshots were reportedly heard after the blast.
Pakistan has been witnessing a major rise in terror activities ever since TTP ended its ceasefire with the government in November last year.
The rise in terror activities has been mostly recorded from KP and Balochistan.