"Several witnesses have been questioned. We plan to further investigate the area today. Our suspicion at the moment is that the fire was caused by [a] short circuit."
Vukko Bakkara, the Medan fire department chief, told The Jakarta Post newspaper that he also believed a short circuit caused the fire.
Most of those who died reportedly died of smoke inhalation.
"From the third floor the fire spread rapidly to other floors," a witness was quoted as saying by the Detikcom online news agency.
The job of evacuating the building had been complicated by the fact that most of the karaoke lounges were locked when the fire started.
Local officials said that safety standards at the entertainment complex had to be examined for the future.
"We have to be more careful in the future. All buildings have to be checked whether they have complete emergency tools. We need to inspect all the alarms," Eddy Sofian, a spokesman for the North Sumatra administration, said.
A number of deadly fires have been reported in Asia and many have been blamed on a disregard for fire regulations.
Sixty-four people died in a fire at a nightclub in Bangkok's Ekkamai district in January.
Police suggested it might have been caused by a fireworks display, but officials said they were also investigating the wiring in the club and sparklers given to guests.