The explosion was reported around 8.45am local time (4.15am GMT) on Wednesday morning. City police chief Ghazanfar Ali told Associated Press that police officers were the apparent target.
Five police officers and three civilians were killed in the attack, local news reports said, The Guardian reported.
Hundreds of pilgrims were in and around the 11th-century shrine when the explosion occurred. At least 25 people were injured, said Mohammad Ashfaq, a deputy inspector with the Lahore police.
Footage from the scene showed a charred vehicle surrounded by debris and roped off by police and rescue workers.
It is not clear if the shrine was the intended target and what, if any, damage it had suffered. Security officials are gathered outside one of its gates.
Pakistan’s prime minister Imran Khan has condemned the attack. The Punjab government is holding an emergency law and order meeting.
Suicide bombers blew themselves up at the shrine in 2010, killing 50 people and injuring at least 200 others.