"Several people have been killed, the blast was big ... the number of those killed is around 11," police official Mohamed Adan said.
Four government officials visiting from Qatar were travelling in armoured vehicles belonging to the interior ministry when the convoy was attacked, but were unharmed.
"The convoy was escorting a delegation from Qatar, the police escorted them to a safe area after they survived the attack," General Garad Nur, a senior police commander, told reporters.
The car exploded close to a police station at the central K4 roundabout, a busy part of Mogadishu where many people gather to drink tea at roadside stalls.
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Other police officials said that at least 10 people had been killed.
"I saw eight bodies including a woman, some of them were burned very badly by the fire from the explosion," said eyewitness Ali Yusuf. "It was a terrible sight."
Body parts were strewn around the blast site, where fire trucks sprayed water on the smouldering wreckage of the vehicles while several wounded were taken to hospital.
A second bomb hidden by the roadside and remotely detonated was set off around the same time in the Daynille district of Mogadishu targeting passing security forces, but injured no one, police added.
The attacks come just ahead of a conference in London on Tuesday to draw up plans to boost security and increase development in conflict-torn Somalia.
No one immediatly claimed responsibility for today's blast, but it comes a day after senior Shebab commander Ahmed Abdi Godane released an audio message in which he urged "the mujahedeen to increase the number of martyrdom operations, so as to permanently cripple the weak apostate regime."
Last month, the Shebab launched a show of force in a complex coordinated attack, killing at least 34 as suicide commandos stormed the main courthouse while a car bomb was set off elsewhere in Mogadishu.
The insurgents recently released a series of photographs of masked gunmen flying black flags in front of machine guns mounted on trucks around the southern Somali port of Barawe, one of their few remaining strongholds.
The attack today comes after a week-long major security operation in the capital, with police closing down roads and searching cars for explosives.