The blast happened in Peshawar, the capital of North West Frontier Province, and most of the injured were passers-by, said Mohammed Nabi, a local police official.
The vehicle where the bomb was planted was destroyed, and nearby cars were damaged. Police sealed off the site, and bomb disposal experts were collecting samples from the wreckage.
The injured were taken to a hospital, Nabi said, adding there was no immediate indication who was responsible for the bomb.
The blast came two weeks after a suicide bomber with a warning for American spies taped to his leg blew up a restaurant in Peshawar, killing 25 people in the old quarter of the frontier city synonymous with violent Islamic radicalism and political intrigue.
Security officials indicated the May 15 blast could be retaliation for the killing the previous weekend of Mullah Dadullah, the Taliban's military chief in nearby Afghanistan - a further sign the war between Islamic militants and NATO forces was spilling across the border.