Police said the blast went off inside the mosque, located near Meena Bazaar, as the people were preparing for Zohr prayers, adding that 30 to 35 people were present at the time of the explosion.
The prayer leader of the mosque also lost his life in the incident.
Inspector general of bomb disposal squad said three to four kilograms of explosives were used in the blast, which also contained ball bearings.
Rescue teams, assisted by locals, shifted the bodies and the injured to the Lady Reading Hospital of the Pakistan’s northwestern city.
Peshawar has a population of more than 2.5 million people and has long been on the frontline of violence blamed on an insurgency led by Taliban militants opposed to the country’s alliance with the United States.
Pakistan has battled a homegrown insurgency for years, with more than 3,000 soldiers killed in the battle against militancy.