A massive bomb hidden in a sewage tanker has exploded in the centre of Afghanistan's capital during the morning rush hour, killing at least 80 people, wounding hundreds and damaging embassy buildings.

Key points: The blast hit during rush hour, killing 80 and injuring hundreds more

The blast hit during rush hour, killing 80 and injuring hundreds more Police say explosives were concealed in a sewage tanker

Police say explosives were concealed in a sewage tanker Australia's embassy is in lockdown, and Germany and France's embassies were damaged

Australia's embassy is in lockdown, and Germany and France's embassies were damaged The Taliban has denied responsibility for the attack

The explosion — one of the deadliest in Kabul — came at the start of the holy month of Ramadan, shattering windows and blowing doors off their hinges in houses hundreds of metres away.

Basir Mujahid, a spokesman for city police, said the explosives used in the unusually powerful bombing were hidden in a sewage tanker.

Video shot at the scene showed burning debris, crumbled walls and buildings and destroyed cars, many with dead or injured people inside.

A public health official said at least 80 people had been killed and more than 350 wounded.

The victims appear mainly to have been Afghan civilians.

The bombing happened close to the fortified entrance to the German embassy, killing a security guard and wounding some staff.

Afghan officials inspect the outside the German embassy after the blast. ( Reuters: Mohammad Ismail )

But Mr Mujahid suggested the embassy might not have been the target of the blast, which sent clouds of black smoke into the sky near the presidential palace.

"There are several other important compounds and offices near there too," he told Reuters.

A statement from the NATO-led Resolute Support mission in Kabul said Afghan security forces had prevented the vehicle from entering the heavily protected Green Zone that houses many foreign embassies and its own headquarters, suggesting it may not have reached its intended target.

BBC driver killed, four journalists injured

The blast damaged more than 30 vehicles that were parked nearby. ( Reuters: Omar Sobhani )

An Afghan driver working for the BBC was killed in the attack, and four journalists who were riding with him at the time were injured.

In a statement, the BBC said it was a devastating loss for the media organisation.

Sorry, this video has expired Beverley O'Connor speaks to Kabul-based journalist Sune Engel Rasmussen

"Mohammed Nazir worked as a driver for the BBC Afghan Service for more than four years and was a popular colleague," it said.

"He was in his late 30s and he leaves a young family."

Germany's Foreign Minister Sigmar Gabriel wrote on Twitter that employees of the German embassy were injured in the blast, and an Afghan security guard had been killed.

"It hit civilians and those who are in Afghanistan to work for a better future for the country with the people there," Mr Gabriel said.

"It's especially contemptible that these people were the target."

The Afghan Taliban denied responsibility for the attack.

Taliban spokesman Zabihullah Mujahid said in a statement that the movement's fighters had no involvement, adding it condemned any such untargeted attacks that caused civilian casualties.

Australian embassy in lockdown

The explosion hit during rush hour, when roads were packed with commuters. ( Reuters: Mohammad Ismail )

The secretary of the Department of Foreign Affairs and Trade, Frances Adamson, said staff at the Australian embassy were shaken but unharmed.

"Windows were blown in, even though our embassy was 900 metres away from the site of the detonation of what was a very large bomb," she said.

"Our embassy is in lockdown."

Afghan President Ashraf Ghani also strongly condemned the attack in statement that said "the terrorists, even in the holy month of Ramadan, the month of goodness, blessing and prayer, are not stopping the killing of our innocent people".

Pakistan also issued a statement, saying it "strongly condemns the terrorist attack in Kabul this morning that has caused loss of precious human lives and injuries to many".

Prime Minister Malcolm Turnbull joined a number of other leaders in condemning the attack, writing on Twitter that Australia stood with the people of Afghanistan.

Loading

'It felt like an earthquake'

There was chaos at the site of the explosion. ( Reuters: Omar Sobhani )

At the Wazir Akhbar Khan hospital a few blocks away, there were scenes of chaos as ambulances brought in wounded and frantic relatives scanned casualty lists and questioned hospital staff for news.

"It felt like an earthquake," said Mohammad Hassan, 21, describing the moment the blast struck the bank where he was working.

Another lightly wounded victim, Nabib Ahmad, 27, said there was widespread destruction and confusion.

"I couldn't think clearly, there was a mess everywhere," he said.

Later, another frenzy broke out outside the hospital as ambulances and police trucks began bringing in the bodies of those killed.

Some bodies were burned or destroyed beyond recognition.

The blast comes one day after a car bombing outside an ice-cream parlour in the Iraqi capital Baghdad, which killed more than 20 people including a 12-year-old girl from Melbourne.

Violence around Afghanistan has been rising throughout the year, as the Taliban push to defeat the US-backed Afghan Government and reimpose Islamic law after their 2001 ouster in a Washington-backed invasion.

A car bomb exploded close to the German embassy. ( Reuters: Mohammad Ismail )

ABC/wires