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An illegal stash of mine explosives was probably to blame for a nightclub blast that killed at least 25 people and levelled a neighbourhood in northeast China, media reports said on Friday.

The explosion ripped through the club in Benxi county in Liaoning province, killing at least 25, including eight young women celebrating a birthday, and injuring 41, four seriously.

"The explosion was so powerful that there must have been about one tonne of explosives," the Beijing News quoted an investigator as saying.

The owner of the club, who was killed in the blast, had stowed the explosives in a vault beneath the club in the township of Tianshifu, which has 300-400 licensed or unlicensed small coal mines, the newspaper quoted local residents as saying.

"The boss of the club was quite rich and ran a coal mine as well," a local resident surnamed Liu told the newspaper.

The explosion appeared to be the latest instance of lax safety in densely populated mining areas that has brought mayhem in the past.

In 2005, a cache of mining explosives in the home of a mine manager blew up and killed 20, including children at a nearby school in Shanxi province in the country's north.

In 2006, explosives kept in a hospital by a coal mine owner exploded and killed 35 people in Shanxi, where a quarter of China's coal is produced.

The explosives behind the latest disaster were TNT made by a nearby factory and police also found detonators at the site, the Beijing News said. Police have placed the widow of the club owner and surviving club staff "under control", the report said.

Pictures showed the two-storey building was completely levelled and several cars were buried under the concrete debris.

The blast turned the area around the club to rubble and damaged 462 homes, including 78 so badly that residents could not stay in them, the official Xinhua news agency reported, citing local officials.

The entertainment club comprised a bathhouse and a karaoke bar, where 13 young girls from a local department store were attending a birthday party at the time of the blast, the Beijing News said. Eight of them died, it said.

A local official reached by telephone told Reuters that police were still investigating the cause of the blast.