The nine-storey apartment block, called Margala Towers, in Pakistan's capital, Islamabad, was demolished in the earthquake measuring at least 7.6 on the Richter scale on Saturday.
Pakistan's President Pervez Musharraf said the massive quake which rocked his country - as well as regions of India and Afghanistan -was a "test for the nation" as he visited the site of the collapsed apartment block in Islamabad.
The block had housed the staff of many embassies and top diplomats based in Pakistan, including staff from the Hungarian and Egyptian embassies.
Director of Aljazeera's office in Pakistan, Ahmad Zaidan, reporting from Islamabad, said the toll in the earthquake was sharply rising as officials tried to determine the extent of the damage.
Military and civil rescue teams had been called on to assist, and had launched operations to evacuate the injured and rescue survivors, Zaidan said.
Earlier reports from the scene described the area as practically demolished, with an adjacent building on the verge of collapse and with thousands of people having gathered in the street while others tried to help by digging through the rubble to find survivors and evacuate the injured.
Aljazeera learned that an Egyptian diplomat had been killed when the building was levelled.
At least two people were killed and 32 injured, police said, and photographers at the scene said they had seen more bodies being pulled out.
Residents search the rubble of
buildings for survivors
An Egyptian national working for a mobile phone company died and another Egyptian was injured when the block collapsed, Egyptian ambassador Husain Haridy said.
The dead man, a married father of two, "was still breathing when he was pulled out of the building but he died upon reaching the hospital," Haridy said.
"We are very sorry, not only for the death of the Egyptian national but also for the people of Pakistan. We have presented our condolences to the government of Pakistan," he added.
It has been estimated that about 100 to 120 people were in the apartment block when the earthquake hit, he added.
Pakistani officials in northwestern Pakistan said more than 1000 people had been killed in one area alone.
The authorities have also warned that the destruction caused by the massive quake is vast, and they expect the toll to increase significantly.
Officials have outlined the areas worst affected and include parts of Kashmir.
Pakistan's Foreign Minister said hundreds of people had been killed in Islamabad, Rawalpindi, Kashmir and other areas in northwestern Pakistan.
After an aerial survey of stricken areas, chief military spokesman Major-General Shaukat Sultan said: "The death could be running in the thousands. We do not have an exact figure for casualties at this moment, but it's massive."
"The death could be running in the thousands. We do not have an exact figure for casualties at this moment, but it's massive"
Major-General Shaukat Sultan,
chief military spokesman
"The hardest hit areas are Mansehra district and Muzaffarabad and its adjoining areas," he said, referring to two mountainous northern districts.
"We took an aerial view soon after the tremors and have started rescue operations. Army helicopters are airlifting injured people and have intensified rescue operations," Sultan added.
Villages wiped out
Police in northern Mansehra district said two high schools collapsed and rescuers had recovered 10 bodies out of the debris. "Some 40 injured were also recovered," a police official said.
Interior Minister Aftab Ahmed Khan Sherpao told ARY One television he had reports that several villages had been wiped out.
Geo TV said 25 people had been killed in Pakistani Kashmir and about 30 in the Hazara area of North West Frontier Province.