"In this act 18 Zahedan citizens have been martyred," military commander Qassim Rezai told the IRNA news agency.
"Rebels and those who create insecurity martyred these people in a terrorist act by laying a trap close to a bus," he said.
Local Guards commander Mohammad Javad Ethna Ashari said 31 people were wounded in the blast.
Witnesses quoted by IRNA said militants placed a booby-trapped car in the path of a bus carrying Revolutionary Guards ground forces and detonated the explosives when the bus drew near.
The bus was taking the Guards from their housing compound in the city of Zahedan to a military base.
Witnesses said militants riding motorcycles shot at the bus to force it to stop and detonated a booby-trapped car by remote control.
Pictures from the scene showed crowds of people surrounding a mangled wreck of metal with only the back of the bus in a clearly recognizable shape.
One aid worker was quoted as saying the carnage made it difficult to count the number of people killed in the blast.
It was not immediately clear whether all the dead were from the Revolutionary Guards.
A spokesman in the Zahedan governor's office said he was still waiting for figures on the number killed.
"Four people have been arrested for involvement with the bombing," he told Reuters without giving further details.
A group calling itself Jundollah (God's soldiers), a shadowy Sunni group, claimed responsibility for Wednesday's attack. Iran links the group to the Al-Qaeda group
Iran has said Jundollah was behind the murder of 12 people in a roadside attack in May, and other incidents in the region.
Zahedan is the capital of Sistan-Baluchestan province which borders both Afghanistan and Pakistan and has been hit by a string of attacks and kidnappings blamed on a Sunni group called Jundallah (Allah's Brigade).
The province has a substantial Baluch community, a minority Sunni Muslim group.
Zahedan, a dusty and tense border city, has been the centre of low-level unrest in the region over the past months.
Earlier this year, four members of the Iranian security forces were killed in the city when armed men opened fire on their vehicle. In December, a car bomb exploded in Zahedan, killing one person.
The upsurge in unrest in Sistan-Baluchestan comes after violence in Iran's oil-rich southwestern province of Khuzestan, which has a minority Arab population.
Bomb attacks in October 2005 killed six people in the provincial capital of Ahvaz and wounded nearly 100. Another double bombing in January 2006 killed eight and wounded 46.
Iranian officials have accused Britain and the United States of supporting ethnic minority rebels operating in Iran's sensitive border areas.
Iranian Intelligence Minister Gholam Hossein Mohseni Ejeie said last week Tehran had identified 100 spies working for the United States and Israel in Iranian border areas.
Such accusations come amid rising tensions between Iran and the West over the Iranian nuclear program, which the United States alleges is cover for a weapons drive.
Iran denies the charges, saying the program is purely aimed at generating energy.
Although the Bush administration has said it wants the nuclear standoff resolved through diplomacy, it has never ruled out military action to thwart Iran's atomic drive.Güncelleme Tarihi: 20 Eylül 2018, 18:16