The blast occurred in a compound in Sundana Teera area of Khyber, one of the seven tribal districts in the country, where Taliban militants have their hideouts.
An official from the area confirmed the blast and the casualties.
He said the exact nature of explosion was not known but added that these kinds of blast are usually caused by explosives stored illegally without following safety measures.
Parts of Khyber are controlled by Mangal Bagh of Lashkar-e-Islam militant outfit.
The provincial government of Khyber-Pakhtunkhwa which borders the tribal region has announced a bounty of Rs 10 million on Bagh.
The military is also focused on banned Lashkar-e-Islam, which has so far claimed over 300 lives in the area, and surrendering of more than 400 militants.
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