The Pakistan Rangers, a paramilitary force, took control of several restive areas of Karachi after the blast, officials said.
"People have been saying that the government has been apathetic to the listening to the warnings of potential attacks and people's fears," Talat Hussain, the director of news at the local AAJ TV, told Al Jazeera.
"Any number of groups come to mind who may have carried out the attack ... The game clearly is to disrupt Pakistan."
Rehman Malik, the interior minister, called for people to show restraint and asked that Shia processions over the next two days be cancelled following the attack.
Imran Khan, Al Jazeera's correspondent in Islamabad, said: "The Shia community would certainly have been the specific target of this attack, but there have been no claims of responsibility so far."
"It is impossible to stop someone who is prepared to die. There is an atmosphere of fear throughout the city"
Fazal Qureshi, chief editor of Pakistan Press International
"The Shia are in the minority but make up a significant number of Pakistanis.
"They are woven into the fabric of Pakistan. However, they are under attack for their beliefs."
Television footage showed crowds around the blast area, smoke rising over the scene and ambulances going back and forth.
"I fell down when the bomb went off with a big bang," Naseem Raza, a 26 year-old who was marching in the procession, told The Associated Press news agency.
"I saw walls stained with blood and splashed with human flesh."
Fazal Qureshi, the chief editor of the Pakistan Press International news agency, told Al Jazeera: "These processions cover long distances, they were marching through the central road when suddenly the bomber blew himself up.
"It is impossible to stop someone who is prepared to die. There is an atmosphere of fear throughout the city."
Major Aurangzeb Khan, a spokesman for the paramilitary troops who were protecting the procession, said the death toll would have been much higher if one of the soldiers had not spotted the suicide bomber and tackled him.
"He just took him down, and the bomber detonated himself," he said.
Authorities found the intact head and torso of the suicide bomber on the third floor of a nearby office building, where it had broken through a window, Munir Sheikh, a bomb disposal squad official, said.
About 16kg of high explosive were used in the bombing, he said.
Pakistan had tightened security to protect mass processions ahead of Ashoura, deploying tens of thousands of police and paramilitary forces.
The attack in Karachi was the third on the commemorations in Pakistan this year. A suicide attack at a Shiite mosque in Pakistani-administered Kashmir on Sunday killed seven people, while wxplosives wounded 17 people in Karachi on the same day.