According to initial reports, the blast occurred outside a restaurant in a shopping plaza in Defence Block-Z.
The blast in the busy market was so powerful that it damaged a portion of the building and shattered windowpanes of several nearby buildings. Shops and vehicles parked near the plaza were also affected.
Rescue teams and police rushed to the scene and shifted the injured to hospitals. Medics confirmed that eight people have died with nearly 30 injured.
Nature of the blast is yet to be ascertained.
Police and rescue officials said the blast was caused by generator’s explosion but reports at the scene speculated that a bomb had gone off, based on the extent of the damage.
Police did not rule out possibility of any terrorist activity saying that the area was issued a terror alert last week.
According to media, Punjab police spokesman Nayab Haider said it was a bomb attack.
Some police officials told media persons on condition of anonymity that it was a car bomb blast.
Meanwhile, reports came about a second explosion in the city’s Gulberg area. Police and rescue teams rushed to the site; however, it proved to be just a hoax.
Punjab Law Minister Rana Sanaullah, while speaking to media, also denied any such blast.
The blast came two weeks after an apparent suicide blast killed 13 people at a protest in Lahore, shattering the city’s growing sense of security.
The incident also came a day after federal government approved Punjab government’s request for deployment of Rangers in the province.
On Wednesday, the military announced a nationwide anti-terrorist operation Radd-ul-Fasaad.
Special coverage on China's Two Party Sessions by The Daily Mail - People's Daily