The incident occurred in Baldia Town area of Karachi at the 'Astana' (meeting place) of retired police officer Tikka Khan, SSP Aamir Farooqi said.
"The Astana of the retired officer was used for religious gatherings where people came to seek blessings from a pir to find solutions for their problems," Farooqi said.
Rescue and police officials said seven persons died while the condition of some of the injured is critical.
"We are treating 12 injured and the condition of at least three is very critical," Aftab Channar, an official of Civil Hospital, told PTI.
He said the armed men, who were riding motorcycles, first threw grenades at Astana Meherban Shah and then opened fire.
The banned Tehrik-e-Taliban Pakistan (TTP), who are holding talks with the government, said they had nothing to do with the attack, Dunya news channel reported.
The TTP in the past has attacked shrines and other religious places where people come to see pirs (Saints).
In recent weeks, there have been at least three such incidents where bodies were found with notes saying those who believe in pirs and go to shrines will meet the same fate.
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