Five people have been killed after a cargo train carrying propane-butane derailed and exploded in Bulgaria.

At least 25 people are reported to have been injured in the incident, which damaged around 20 buildings in the northeastern village of Hitrino, police said.

It is believed seven of the train's tanks derailed at the station of the village, hit an electricity line and exploded in flames.

"Two blasts have caused a serious fire and ruined at least 20 buildings. There are many people injured ... many with burns," Interior Ministry Chief Secretary Georgi Kostov said.

At least three of the victims remain in critical condition and the number is likely to rise, authorities said.

"There will be more casualties for sure," outgoing Bulgarian Prime Minister Boiko Borisov said after visiting the village.

Around 150 firemen are tackling the fire and searching for survivors.

Nikolai Nikolov, head of fire safety and civil defence at the police, told reporters: "We do not expect a second blast, but the people from the village are being evacuated."

Police said an investigation into the incident has been launched.