The police camp was set up for the security of an ongoing congregation of Tableeghi Jamaat.
Deputy Inspector General of police Haider Ashraf said the bomb exploded when the police were changing guards at the checkpoint just outside an annual religious congregation, where almost 80,000 people were in attendance.
The nature of the blast was not immediately clear.
The senior police official stressed that if the suicide attacker had managed to enter the congregation site, the death toll could have been much higher.
According to rescue officials, a caller who informed them about the incident said it was a cylinder blast.
There were no immediate claims of responsibility for the bombing near Lahore, the capital of Pakistan's most populous Punjab.
In a tweet, Punjab province's government "strongly condemned" the attack.
Haider Ashraf, Lahore police chief, said that evidence collected from the scene suggested it was a suicide attack.
The top officer also directed further tightening the process of checking and monitoring at the entry and exit routes of the metropolis. The suicide attack has taken place a week before the semi-finals of the Pakistan Super League in Lahore.
A suicide attack near a software technology park in Lahore killed 26 people and wounded over 50 in July past year. Lahore experienced multiple terror attacks in 2017 that killed more than 60 people.