The incident came days after explosives devices were lobbed at Saudi Arabia's consulate here.
The Saudi diplomat, identified in media reports as Hasan M M Al-Kahtani, was attacked by four gunmen riding two motorcycles while he was driving to work.
The attack occurred a short distance from the Bahrain consulate. The Saudi Embassy in Islamabad confirmed that the victim was a diplomat. Police officials said the gunmen intercepted the car and sprayed over a dozen bullets at the victim.
He was declared dead on arrival at the Jinnah Hospital. The banned Tehrik-e-Taliban Pakistan claimed responsibility for the killing, Geo News channel reported.
A Taliban spokesman called the media to take responsibility. Earlier on May 11, two men riding a motorcycle lobbed two low intensity explosive devices at the Saudi consulate in Karachi though no one was injured in the attack.
Saudi officials said the blasts caused minor damage to buildings within the consulate compound.
Saudi Assistant Foreign Minister Prince Khaled bin Saud had urged Pakistani authorities to ensure the protection of the kingdom's diplomatic missions in the country.
Today's attack came a fortnight after US special forces raided a compound in the garrison city of Abbottabad and killed Osama bin Laden, a critic of the Saudi government.
Al-Qaeda and Taliban have pledged to take avenge bin Laden's death.