At least three people have been killed in the blast.
The blast took place close to the Data Darbar, one of the largest shrines in South Asia, and several people including police officers had been wounded, Punjab province police spokesman Nayab Haider said.
The blast comes as the country marks the fasting month of Ramadan.
The shrine is located inside the ancient Walled City in Lahore, Pakistan’s second-biggest city.
It is visited by hundreds of thousands of people each year from both Sunni and Shia traditions of Islam.
In 2010, dozens died in two suicide blasts at the shrine.
Source: standardmedia