The powerful blast occurred close to a girls' school in provincial capital Quetta's Hazara town, said a senior police official.
"We suspect it was a suicide bomber as body parts of the suspected bomber have been found at the site," he said.
The Hazara town is inhabited mainly by the ethnic Hazara Shia minority, which has been often targeted by extremist militant groups in the past.
"Several people are injured as result of blast and some of them are in critical condition," the official who was at the blast site said on phone.
A Balochistan government spokesman said the casualties could rise and emergency has been declared at all state-run hospitals.
The blast was heard far and wide, causing panic among people who ran helter-skelter. Some people also resorted to aerial firing before rescue teams and police official reached the spot.
"There was a crowd of people at the site when the bomb went off," said another police official.
Last year, there were two major suicide bomb blasts in Hazara town, and in late June a suicide bomber blew himself up at the site of tonight's blast. Atleast 30 people were killed and 70 injured in that blast.
Banned militant outfit Lashkar-e-Jhangvi claimed responsibilities for these attacks.
Quetta is the capital of resource-rich Balochistan province -- home to a long-running separatist conflict that was revived in 2004, with nationalists seeking to stop what they see as the exploitation of the region's natural resources and alleged rights abuses.
In the past few years, the provincial capital has also been a flashpoint for sectarian violence mainly targeting the ethnic Hazara community.