It was not yet clear if the explosion, that hit the city's largest gambling complex, the Rummy Club, was a criminal act or caused by extremists in the teeming violence-plagued city, a senior home ministry official told AFP.
"Three more people died of their injuries in hospital overnight, bringing the toll to 19," the ministry's Sharfuddin Memon said, adding that more than 40 people were receiving hospital treatment with three in a critical condition.
"We are investigating if the attack was the result of rivalry between criminal gangs or if some vigilante groups of extremists were involved," Memon said.
Hospital official Saleem Ahmed confirmed the casualty figures.
The city houses many clandestine gambling dens, which are officially outlawed in the Islamic nation and subject to occasional police raids.
Police said the bomb was small, made of two kilograms (four pounds) of explosives, but casualties were high because the gambling hall was crowded at the time.
Karachi is Pakistan's economic hub, home to its stock exchange and a lifeline for a depressed economy wilting under inflation and stagnating foreign investment.
The violence came just a few hours after Pakistan's army had vowed to defeat terrorism and rejected US accusations of Islamabad "not doing enough" to combat militants in its northwest tribal belt.