Sweden's TV4 showed footage of smoke emerging from the windows and scorched entrance to a residential building as well as emergency services working at the scene.
One man told TV4 that he had been woken by the blast.
"I thought it was an explosion and then I thought it could have been a door that was slammed shut, the neighbours, but I was like 'no it didn't sound like that' and then I thought could it be a storm? But I thought explosion, but hoped it wouldn't be," Christian Olsson said.
The immediate cause of the blast and blaze was unclear.
At least 16 people were taken to hospital after fire fighters pulled people out of a residential bloc from which smoke was billowing.
Three women and one man were treated for serious injuries, a Sahlgrenska University Hospital spokesperson said.