Although an independent, Khan is supported by the Awami National Party, a secular party of ethnic Pashtuns seen as a rival to Pakistani Taliban groups.
Afrasiab Khattak, a senior party official in the area, said Khan "is injured, but in stable condition".
Candidates must, by law, stand as independents in Pakistan's semi-autonomous tribal areas bordering Afghanistan, but are often affiliated to political groupings.
Haji Nakim Khan, a tribal leader who was among the wounded, said: "We were having a meeting at a roadside place with Nisar and his supporters when the explosion occurred."
"We found severed legs at the site of attack, so we think it was a suicide attack," he said.
Police said there was no claim of responsibility for the bombing, but it has fuelled fears for security during Pakistan's parliamentary elections on February 18.
A suicide bombing at an election rally held by the Awami National Party in the northwestern town of Charsadda on Saturday killed at least 25 people.
The polls were originally planned for January 8 but were delayed after the assassination of Benzir Bhutto, the opposition leader and former prime minister, on December 27.
More than 80 people have died in suicide and other attacks this year in a wave of violence following Bhutto's assassination.
Bhutto's killing has been blamed on an al-Qaeda-linked commander based in the tribal region of South Waziristan, which borders the area where Monday's suicide attack took place.
Opposition parties have accused the government of playing up the security threats to politicians in a bid to dampen campaigning and improve the chances of parties that favour Pervez Musharraf, the president.
Nawaz Sharif, another former prime minister, on Monday accused the government of "massive" attempts to rig the polls.