The blaze broke out at about 10.30pm on Monday after a candle used in the provincial theatre, 100km south of the capital, set fire to curtains and a wooden stage.
Some members of the theatre company and the audience suffered as much as 80% burns.
About 70 people escaped unhurt from the single-storey theatre, which forms part of the town's cultural centre.
Firefighters eventually brought the blaze under control.
About 1000 people were watching the play in the Culture
Palace, a facility run by the Culture Ministry, on a downtown street of Bani Suaif when the fire broke out, a police official said.
The blaze sparked panic in the packed audience, with
hundreds, including many teenagers and children, trying to flee the burning theatre as thick black smoke poured out, witnesses said.
"There were so many people screaming and crying, falling over each other trying to get out," a police lieutenant who was at the scene during the fire said.
He said he went into the building after firefighters got the blaze under control within about 45 minutes.
"I saw bodies everywhere. It was a great shock to see so many dead people," said the lieutenant.
Several hours after the blaze, the cultural centre building was left a burned-out concrete husk with blackened walls.