The Taleban have carried out numerous attacks in Kandahar

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The massive blast hit a crowd of people watching a dog-fighting contest.

"This suicide attack was the work of the Taleban," said Governor Assadullah Khalid, saying the death toll may rise.

Southern Afghanistan is a Taleban stronghold and last week the Kandahar governor himself was the target of an attempt on his life.

The Taleban have not claimed responsibility for the blast, but it bears all their hallmarks, says the BBC's Jon Brain in the Afghan capital, Kabul.

Among those killed was Abdul Hakim, a local police chief fiercely opposed to the Taleban who is thought to have been the target of the attack.

Body parts

Excitement was mounting among the 500-strong, male-only crowd when the huge blast struck.

I counted over 40 people on the ground dead

Abdul Karim,

Dog-fight spectator

Dog-fighting competitions, which were banned under the Taleban regime, are a popular pastime in Afghanistan.

"Fighting had just started between two dogs," said one spectator, Abdul Karim.

"Suddenly I heard a huge explosion next to a police vehicle. Then I saw lots of people dead and wounded.

"I counted over 40 people on the ground dead," Mr Karim, 53, told the AFP news agency.

Twisted car and bicycle parts littered the ground as shawls and shoes lay scattered among the bodies of the dead and wounded.

MAJOR TALEBAN ATTACKS 29 Dec 2007: 16 policemen killed in Kandahar 6 Nov 2007: At least 70 die in attack on sugar factory in Baghlan province 29 Sep 2007: At least 30 soldiers killed in bus attack in Kabul 16 Jan 2006: At least 24 people killed in two attacks in Kandahar

Deadliest Afghan attacks In pictures: Afghan blast

Scores of wounded were packed into civilian cars and rushed to hospitals in the city centre, some 15km (nine miles) away.

Estimates of the death-toll from Sunday's attack varied.

While Governor Assadullah Khalid stood by his original estimate of 80 killed, Kabul's interior ministry, which originally said more than 80 died, later dropped its toll to 65, saying more than 50 were wounded.

Last November, a suicide bombing in the northern Baghlan province killed 79 people - mostly school pupils - in the bloodiest bombing since the Taleban were ousted in 2001.

Taleban influence

Aside from Abdul Hakim, several policemen were reported to be among the victims of Sunday's blast.

The Taleban claim to have influence across most of the country and have extended their area of control from their traditional heartland in the south.

They have a significant presence around Kandahar from where they carry out suicide attacks and roadside bomb blasts.

The militants are even able to operate freely in Wardak province, neighbouring the capital Kabul.

Last year, violence in Afghanistan reached its highest levels since the Taleban were forced from power in 2001, analysts say.