According to Balochistan Home Minister Sarfaraz Ahmad Bugti, two suicide bombers targeted the church, one of whom was shot dead outside.
Police guards at the church exchanged fire with the attackers before they could enter the main sanctuary, said provincial police chief Moazzam Jah.
Police said terrorists attacked Bether Memorial Methodist church when the Sunday prayer was being held.
Reportedly, two suicide bombers stormed the church- out of which one was killed at the entrance but the other managed to explode his vest inside.
Last month, a suicide attack targeting paramilitary soldiers killed at least four people and wounded 15 others.
The report said that the police and rescue teams have reached the site of the explosion. A bomb disposal team is on standby. The church was holding a "Sunday School Christmas Programme" at the time of the attack.
An emergency has been imposed in the hospitals of the city.
Gunshots could be heard following a blast in the area as security forces were quick to respond to the attack.
The resource-rich Balochistan, which borders Afghanistan and Iran, has been plagued by sectarian violence, Islamist militant attacks, and a separatist insurgency that has led to thousands of casualties since 2004.
This is a developing story and will be updated as further details are available.