"There had been a suicide attack on Gamboru market this morning. It was a female suicide bomber. The attack happened around 6:30 AM (1100 IST) as the grocers were arriving in the market which starts early," said Babakura Kolo, a vigilante helping the Nigerian army combat Boko Haram jihadists in the region.
There was no immediate information on the number of victims, although witness accounts suggest that there were casualties.
A witness, who declined to be named, corroborated this account.
"I was at home when I heard a loud explosion that sent me rushing out of my house. It was coming from the Gamboru market... The place was littered with victims and burning rickshaws," the source told AFP.
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Gamboru market is the second-largest in Maiduguri, capital of Borno state and birthplace of Boko Haram.
Many of the recent attacks have been carried out by women and girls.
A woman described by locals as mentally unstable blew blew herself up last Sunday at a crowded market in Damaturu, capital of neighbouring Yobe state, killing at least 14 people.
Damaturu was also the scene of a triple suicide bombing on July 18 when three girls blew themselves up, killing at least 13 people as residents prepared for the Eid festival marking the end of Ramadan.
Yesterday, Nigeria named Major General Iliya Abbah, who previously commanded military operations in the oil-rich Niger Delta, to head a five-nation Multi-National Joint Task Force to take on Boko Haram.
The force is to comprise 8,700 troops from Nigeria, Chad, Cameroon, Niger and Benin.