The explosives-laden car was parked at a CNG station as the attackers apparently could not get close to the intelligence agency's heavily-guarded office in Civil Lines area of Faisalabad, regional police chief Aftab Cheema told PTI.
"It is yet to be determined whether the attackers abandoned the car near the CNG station or deliberately parked it there. Twenty people were killed in the blast," Cheema said.
The explosion, which occurred at about 11.30 am local time, destroyed the CNG station, at least three buildings and dozens of cars near the ISI office. Over 100 others were also injured.
Several bodies and injured persons were pulled out of the rubble of buildings that collapsed due to the explosion. The injured were taken to several nearby hospitals and officials described the condition of 13 of them as serious.
Doctors performed emergency surgery on at least eight persons. District administration chief Naseem Sadiq too confirmed the attack was carried out with a car bomb.
Faisalabad Commissioner Tahir Hussain said heavy machinery had been called in to remove the rubble.No group claimed responsibility for the blast.
Footage on television showed a body trapped within a mangled vehicle and another lying in the debris of the CNG station.
Fire fighters sprayed water on several cars that were on fire at the CNG station. Other cars were buried under the rubble of collapsed buildings. Rescue workers helped several injured persons, their clothes stained with blood, into ambulances.
Witnesses said the car bomb created a crater. Further damage was caused as cylinders at the CNG station exploded, they said.
Reports said the ISI office in Civil Lines area, located a short distance from the CNG station, was heavily guarded. There were blockades and check posts on the road leading to the office.