The blast on a tree-lined avenue in the heart of Tunis is a new blow to a country that has struggled against Islamic extremist violence.
Radical gunmen staged two attacks earlier this year that killed 60 people, devastated the tourism industry and rattled this young democracy.
Police fanned out throughout central Tunis after Tuesday’s explosion, and ambulances rushed to the scene, evacuating wounded and dead.
Interior ministry spokesman Walid Louguini said that at least 12 were killed and 16 wounded in what the government considers a “terrorist act”.
President Beji Caid Essebsi was not in the bus at the time. His presidential guard is an elite security force that protects only the president.
Witness Bassem Trifi, a human rights lawyer, said the explosion hit the driver’s side of the bus, describing a “catastrophic spectacle”.
“I saw at least five corpses on the ground,” he said.
The attack came days after authorities visibly but inexplicably increased the security level in the capital and deployed security forces in unusually high numbers.
The French embassy in this former French territory was also put under high protection in recent days, after extremist attacks in Paris killed 130.
Tunisia is the only Arab Spring country to have solidified a new democracy, but it is facing serious economic and security challenges.