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Earlier reports had said that the blast was a suicide attack, but officials from the area said that the nature of the blast was not clear as yet.
Local officials said that the blast site was where a budget market is set up every Friday.
"A bomb exploded in the main bazaar of Parachinar. We are collecting details," local government official Shahab Ali Shah told AFP.
"It was a suicide attack," a senior Pakistani security official told AFP on condition of anonymity.
Fazal Saeed, leader of a breakaway faction of the Pakistani Taliban, claimed responsibility for the attack.
“We have targeted the Shia community of Parachinar because they were involved in activities against us,” he told Reuters by telephone from an undisclosed location.
“We also warn the political administration of Parachinar to stop siding with the Shia community in all our disputes.”
Other officials could not confirm whether a suicide bomber was responsible.
"We don't have exact details about the nature of the blast," said the top administration official for the region, Mohammad Anees.
Seven shops were also destroyed as a result of the blast.
The injured were shifted to the Agency Headquarters hospital.
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