Pakistani Prime Minister Muhammad Nawaz Sharif said terrorists were behind the attack and condemned those responsible.
Mr Sharif has directed Punjab Government to provide all possible assistance to the injured.
He said: “Such cowardly acts cannot deter the resolve of the nation to stand against terrorism and our government is committed to root out this menace.”
Immediate aftermath of Lahore explosion
There has been no official word on casualties but locals reports say at least 10 people have been killed and 30 more injured in the bast.
Pakistan’s Geo TV said the blast occurred in the city centre close to the Punjabi provincial assembly during a large street protest against changes to the area's drug policy.
Chaos on the streets of Lahore after the city was rocked by an explosion
The Pakistani city of Lahore has been rocked by an explosion
A large group of chemists and pharma manufacturers were protesting in front of the building near the city's Mall Road when the explosion happened.
Lahore was the site of an Easter Day bombing last year that killed more than 70 people in a public park.