The accident happened in Hunan province when the bus carrying 56 people crashed into the guardrails on a highway.
The ensuing oil leak may have caused the fire, the county government said.
Eleven people including four seriously injured have been hospitalised and rescuers are still searching the charred frame of the bus.
The police has detained the driver of the bus, state-run Xinhua news agency reported.
State-run broadcaster CCTV showed a video in which thick smoke can be seen billowing out from the vehicle while passengers struggle to get out of the bus.
Traffic accidents are common in China and according to the World Health Organisation over 250,000 people die in road accidents in China every year.
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