A fuel truck exploded in the busy centre of a rebel-held town near Syria's border with Turkey on Saturday killing dozens of people and wounding dozens more.

The blast struck near a bustling market and in front of a courthouse in Azaz killing at least 48 people - a death toll expected to rise, the UK-based Syrian Observatory for Human Rights said.

Rami Abdurrahman, the head of the Observatory, said the explosion was caused by a rigged fuel tanker, which explains the large blast and high death toll.

Syria's nearly six-year war has created a patchwork of areas of control across the country, and Azaz is a major stronghold of the Turkish-backed Free Syrian Army (FSA). About 14 of the dead were rebel fighters or courthouse guards.

Images shared online showed a huge plume of black smoke rising above the chaotic market and sounds of gunfire echoing in the background as onlookers gathered around the site. Bodies were strewn on the ground as a father ran away from the scene hugging his child.

Other activist groups, including the Azaz Media Center, put the death toll at 50, adding search-and-rescue operations continued for at least two hours after the blast. The Syrian Observatory said the explosion took place near the local court operated by rebels.

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The attack was the latest in a string of bombings to hit Azaz, 16km south of the Turkish city of Kilis.

The area is a stronghold of the Turkish-backed Syrian rebels involved in a major operation aimed at clearing the Islamic State of Iraq and the Levant (ISIL, also known as ISIS) group from the border region.

Al Jazeera's Hashem Ahelbarra, reporting from the Turkish city of Gaziantep near the Syria border, said there was no immediate claim of responsibility for the attack.

"Azaz is a very strategic town. It had been a stronghold of ISIL since 2013 but the group was evicted by the Free Syrian Army recently. ISIL has been trying to stage a comeback there," Ahelbarra said.

Many rebels and civilians who were pushed out of Aleppo city during a massive government offensive late last year resettled in Azaz.

To the west of Azaz, Syrian Kurdish forces have control of a swath of land, and they have often tried to advance towards the town, causing friction with Turkish troops and allied Syrian opposition fighters.

To the east, opposition fighters backed by Turkey have been pushing back ISIL, gaining territory and advancing on the ISIL-stronghold of al-Bab further east.

ISIL has frequently targeted rebel factions with bombings, including an attack in November that killed 25 civilians and opposition fighters in a car bomb on a rebel headquarters.

At last 20 people were also killed in a separate car bomb attack in October.

Saturday's blast comes as a fragile ceasefire is being observed across much of Syria.

The truce negotiated by Syria's ally Russia and rebel backer Turkey does not include ISIL or the former al-Qaeda affiliate Jabhat Fateh al-Sham.

More than 310,000 people have been killed in Syria since the conflict began with anti-government protests in March 2011.