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The nature of the blast, which occurred at Pashat bazar in Bajaur region at 10.50 am, could not immediately be ascertained.
Malik Mian Jan and Malik Tahsin Khan, two tribal elders who played a key role in leading an anti-Taliban `lashkar` or militia, were among those killed by the blast, officials said.
The injured were taken to hospitals in Khar, the main town of the region located 65 km from Pashat.
Officials said three of the wounded were in a serious condition. The Pashat market was closed following the attack.
Security forces cordoned off the site of the blast and launched a search operation.
The blast targeted Malik Mian Jan`s hotel, where he was meeting other tribal elders, witnesses said. No group claimed responsibility for the blast.
The Taliban have killed dozens of pro-government tribesmen and members of anti-militant militias in the tribal belt over the past few years.
One of the first anti-Taliban militias in Bajaur Agency was formed in Salarzai sub-division, of which Pashat is a part.
Leaders of the anti-Taliban militias had been threatened by the Taliban, local residents said.
Bajaur Agency, which borders Afghanistan, was a stronghold of Taliban militants till they were expelled by security forces in 2008-09.