An initial small explosion was followed by a huge blast just feet from the front of the truck carrying Bhutto during a procession through Karachi. The blast shattered windows in her vehicle and set a police escort vehicle on fire.
Those traveling atop the truck with Bhutto climbed down, with one man jumping off while others used a ladder. Bhutto's lawyer, Sen. Babar Awan, said that the former premier was safe.
CBS News correspondent Sheila MacVicar reports that at least one of the blasts is believed to have been set off by a suicide bomber. She spoke with British journalist Christina Lamb who was riding in the truck with Bhutto.
"Suddenly there was this enormous blast and a huge ball of orange flame came across the top of the bus and we were all thrown to the floor," Lamb said, "and everyone screamed 'down, down!'"
Karachi police chief Azhar Farooqi told Dawn News that Bhutto was rushed from the area under pre-laid contingency plans.
"She was evacuated very safely and is now in Bilawal House," Farooqi told Dawn News television, referring to Bhutto's residence in Karachi.
A senior official from her Pakistan People's Party (PPP) told CBS News that Bhutto "was not in great danger at any time after the blast. Thank god she is safe."
Footage from the scene of the blasts showed bodies on the ground, lying motionless, plus a dozen or more injured who were moving. At least one vehicle was burning.
Bhutto flew home after eight years in exile to lead her Pakistan People's Party in January parliamentary elections, drawing cheers from supporters massed in a sea of the party's red, green and black flags. The police chief said 150,000 were in the streets, while other onlookers estimated twice that.
The throngs reflected Bhutto's enduring political clout, but she has made enemies of Islamic militants by taking a pro-U.S. line and negotiating a possible political alliance with Pakistan's military ruler, President Gen. Pervez Musharraf.
CBS News' Farhan Bokhari reports that Ms. Bhutto's return to Pakistan had been preceded by intelligence reports suggesting that members of Al Qaeda were planning to target her. Upon her arrival on Thursday, she set aside the security plan to be visible only from behind a bullet proof glass and instead chose to stand on an elevated platform, raising objections from Karachi police officials who said, Ms Bhutto had compromised her security.
Authorities had urged her to travel in Karachi by helicopter to reduce the risk of attack. But Bhutto, hated by radical Islamists because she supports the U.S.-led war on terrorism, brushed off the concerns.
"I am not scared. I am thinking of my mission," she had told reporters on the plane. "This is a movement for democracy because we are under threat from extremists and militants."
A senior Pakistani security official in Islamabad said the blasts did appear to be the work of al Qaeda though no one immediately claimed responsibility. "Car bombs of this kind bear the hand prints of al Qaeda", he told CBS News on the condition that he would not be named.
The United States condemned "the violent attack in Pakistan and mourns the loss of innocent life there," said Gordon Johndroe, foreign affairs spokesman for President Bush. "Extremists will not be allowed to stop Pakistanis from selecting their representatives through an open and democratic process."
He said he did not think Musharraf would declare a state of emergency, noting that more serious challenges to state power have occurred recently, like the standoff between militants and police at Islamabad's Red Mosque.
Bhutto had paved her route back to Pakistan through negotiations with Musharraf, a longtime political rival whose rule she has often condemned but whose proclaimed mission to defeat Islamic extremism she shares.
Their talks yielded an amnesty covering the corruption charges that made Bhutto leave Pakistan, and could lead to them forming a political alliance seeking to unite moderates in January parliamentary elections for a fight against militants allied with al-Qaida and the Taliban.
U.S. officials are believed to still favor Musharraf, despite his sagging popularity, over his two main civilian rivals - Bhutto and Nawaz Sharif, the elected premier ousted by the general in a 1999 coup and sent back into exile when he tried to return last
Washington considers Musharraf a source of stability in a nuclear-armed country fighting militants along the border with Afghanistan, an area where Osama bin Laden may be hiding.
Still, amid the uncertainty that parliamentary elections will establish a U.S.-friendly government, the United States wants Pakistan to at least keep moving toward democracy - and Bhutto's return could help that goal.
Musharraf had urged Bhutto to delay her return because of political uncertainty in Pakistan, including a pending court challenge to his controversial presidential election victory this month.
The Supreme Court will rule soon on whether he was eligible to compete in the vote by the nation's lawmakers, since he also holds the post of army chief. If he is confirmed for a new five-year presidential term, Musharraf has promised to quit the military and restore civilian rule - a step critics say he should have taken earlier.
Bhutto said there was still a long way to go in political reconciliation with Musharraf, but added that she expected the court to rule in his favor. "If the court did not stop his election, it's unlikely to stop the result of that election," she said.
Musharraf has seen his popularity plunge recently, and the rapprochement with Bhutto appears aimed at salvaging his political base.
Former Assistant Secretary of State for South Asia Howard Schaffer told CBS News; "You have a situation where two people, who are well known to have considerable distrust for one another, are entering into some kind of arrangement. Will it last? It seems to me that it's doubtful."
"Maybe it will, and I hope it will, but I have misgivings about that," added Schaffer, who is currently Director of Studies at the Institute for the Study of Diplomacy at Georgetown University's School of Foreign Service.
Bhutto became leader of the Pakistan People's Party more than two decades ago after the military's 1979 execution of its founder, her father Zulfiqar Ali Bhutto, a populist prime minister still exalted by many Pakistanis as the finest leader in the country's 60-year history.
She served twice as the democratically elected primer minister between 1988 and 1996 - the first female premier in the Muslim world - but both governments fell amid allegations of corruption and misrule. After Musharraf seized power, she was charged with illegally amassing properties and bank accounts overseas while in power and she left Pakistan.
Many Pakistanis are skeptical that Bhutto can meet her promises of jobs and security.
CBS News correspondent Sheila MacVicar reports that despite her immense popularity within her own party, she is still a divisive figure in Pakistan.
"People are intelligent now, they don't buy this rubbish," said Kamran Saleen, a 38-year-old businessman who lives near Karachi airport.
The bloodshed marred what had been a jubilant day for Bhutto. She received a rapturous welcome from tens of thousands of supporters, many craning from tree branches and foot bridges to glimpse her return.
Hundreds of buses had disgorged crowds of supporters ranging from members of Pakistan's minority Christian and Hindu communities to Baluch tribesmen with flowing white turbans.
Crowds chanted "Prime Minister Benazir!", showered her with flowers, and waved her party's red, black and green flags as her truck inched forward.
"I dreamt of this day for so many months, and years," Bhutto told AP Television News at the airport, after passing under a Quran held over her head as she got off the plane. "I counted the hours, the minutes and the seconds just to see this land, sky and grass. I'm so emotionally overwhelmed," she said, dressed in green with a white head scarf to match the national flag of Pakistan.
After flying in, Bhutto declared she returned to fight for democracy and to help Pakistan shake off its reputation as a hotbed of international terrorism.
"That's not the real image of Pakistan. The people that you see outside are the real image of Pakistan. These are the decent and hardworking middle-classes and working classes of Pakistan who want to be empowered so they can build a moderate, modern nation," she said.