The security source and witness Abubakar Adamu, a mechanic who narrowly avoided being blown up himself, said the blast set several buses on fire at the Marabi-Mubi junction, in a part of the country plagued by violence linked to the Boko Haram Islamist insurgency.
“There were bodies everywhere on the ground,” Adamu said.
The location is about 30 kilometres west of Mubi, a town near the Cameroon border seized last month by Boko Haram militants fighting to carve an Islamic state out of religiously-mixed Nigeria. It has since been recaptured.
Nigerian authorities, who rarely remark on security developments in the troubled northeast, did not immediately respond to requests for comment.
There was no claim of responsibility, but suspicion is likely to fall on Boko Haram, whose campaign to create an Islamic caliphate governed by sharia law has killed thousands since 2009.
Continuing insecurity is a headache for President Goodluck Jonathan ahead of February, 2015, polls in which he is seeking a second elected term in office. He has asked parliament for approval to extend an 18-month-old state of emergency in the northeast.
Two female suicide bombers killed at least 44 people on Tuesday in the northeastern city of Maiduguri, medical officials said.