The blast occurred at Ayesha Manzil intersection, located a short distance from Jinnah Ground where the Muttahida Qaumi Movement had organised a rally this afternoon.
People leaving the rally were hit by the blast at about 7.15 pm, witnesses said.
Officials at Abbasi Shaheed Hospital said they had received more than 30 injured people and three of them were in a serious condition.
Police officials told the media the bomb was planted in a motorcycle parked near a maternity home.
Three buses and several vehicles standing near the motorcycle were damaged by the blast, which was heard from several kilometres away.
The explosion also damaged nearby buildings and shops.
Police cordoned off the area and launched a search operation.
Rescue operations were hampered by a traffic snarl and the large number of people who gathered in the area.
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