The attack targeted a religious gathering marking Mawlid al-Nabi – the Prophet Mohammeds birthday – at the Uranus Wedding Hall in Kabul, according to reports
There are fears the death toll could rise, as hundreds were packed into the large hall near the Afghan capitals airport, more often used to host weddings.
The initial figures were 43 dead and 82 wounded, with nearly one-third of them in critical conditions, the health ministry spokesman, Waheed Majrooh, told local Tolo Television. Images shared by Afghan journalists showed bodies in crumpled piles near a stage and lying by abandoned tables.
No group claimed immediate responsibility for the attack, which was likely the work of the Taliban or the regional affiliate of Islamic State.
The birthday of Muhammad is celebrated by Muslims around the world, but extremists believe marking it is sacrilegious.
In a sign of the toll of long years of war, the Uranus wedding hall hit by the bombing had been damaged in a previous attack in 2012 targeting a bus carrying foreign workers.
The attack was the worst in the capital for more than two months, since a bloody assault on a gym popular with a Shia minority group. It is the latest of many targeting civilians as they go about their daily business, work and prayer.
The first half of this year was the bloodiest on record for civilians, and parliamentary elections in October were the most violent Afghanistan has seen, according to the UN.
The Taliban also controls more of Afghanistan than at any point since it was ousted from government in 2001, and the groups growing strength appears to have spurred international efforts to push for peace.
The US special adviser to Afghanistan, Zalmay Khalilzad, who served as US ambassador to Kabul for more than a decade, has said he hoped a peace deal could be reached before presidential elections set for April.
There is little sense the Taliban shares that urgency, and no indication that increasingly aggressive Isis forces have any interest in even pursuing negotiations.