The bomb attack, which also left six people injured, targeted militant commander Maulvi Abbas Wazir who had close links with foreign fighters and the Islamic Movement of Uzbekistan, officials were quoted as saying by local media.
There was confusion about the nature of the explosion. Some reports said the attack had involved an improvised explosive device while Geo News channel reported it was carried out by a suicide bomber.
State-run Radio Pakistan reported that five persons were killed and six others injured.
The blast occurred in a vegetable market in Wana, the main town of South Waziristan tribal agency.
The army had carried out a massive operation in the region in 2009 but militants continue to be active in the area.
The powerful explosion damaged several shops in the market.
No one claimed responsibility for the attack.
Maulvi Abbas Wazir was a confidant of Taliban commander Nek Muhammad, who was killed in a United States drone strike in 2004.
They were both known for sheltering Uzbek, Tajik and other foreign militants.
Maulvi Abbas left South Waziristan after Maulvi Nazir emerged as the top warlord in the region and launched a campaign against foreign militants.
Abbas returned to the region last year after finalising a deal with Nazir, who is considered a "pro-government" commander.