"It was a bomb attack," Nayab Haider, a spokesman for the provincial Punjab police said. Rescue services spokeswoman Deeba Shehnaz provided the casualty toll.

The explosion took place in the particularly affluent Defence Housing Authority suburb of the city, replete with upscale boutiques and cafes as well as an academy for the international hair salon Toni & Guy.

It came a day after the military announced the launch of a nationwide anti-terrorist operation in the wake of a series of bloody assaults that have killed more than 130 people in the past two weeks.

They included a previous bomb blast in Lahore on February 13 which killed 14 people, and a devastating suicide attack at a Sufi shrine in Sindh province that left 90 devotees dead.

The attacks, which were claimed by the Islamic State group and the Pakistani Taliban, dented growing optimism over the country's security after it appeared to be making strong gains in its decade-and-a-half long war on militancy.