City Police chief Liaquat Ali said that Khan and his two guards have been taken to the hospital.
Ali added that the vehicle of Aurangzeb Khan, leader of the ruling Awami National Party was destroyed in the attack.
Khan party had supported the military offensive against Taliban in the North West Frontier Province bordering Afghanistan.
His brother was killed in a suicide attack in Peshawar in 2009.
The incident adds to the list unending series of terrorist attacks in the city that began in mid-Oct 2009 following Pakistan's military offensive against Taliban.