The attack took place a day before Prime Minister Ahmet Davutoglu, whose government has waged a relentless campaign against Kurdish rebels since last summer, was to make a rare visit to the city.
Speaking to AFP, the source said a remotely-operated car bomb went off as a police vehicle drove past the city's main bus terminal. Of the 23 wounded, nine were civilians and the rest police.
Ambulances rushed to the scene, where images showed the police bus reduced to a burnt-out wreck by the force of the blast.
Hundreds of security force members have been killed since the PKK resumed its more than three-decade insurgency last summer.
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The new upsurge of violence between the security forces and Kurdish rebels erupted in July 2015, shattering a two-and-a-half year truce.
President Recep Tayyip Erdogan said this week that 355 members of the security forces had been killed in the fighting, along with 5,359 members of the PKK. It was not possible to confirm the toll on the rebel side.
A radical PKK offshoot, the Kurdistan Freedom Falcons (TAK), claimed responsibility for two suicide car bombings in Ankara this year that left dozens dead.
Turkish air force planes have bombed PKK hideouts in mountains across the border in northern Iraq as well as in remote areas of southeast Turkey.
Ankara has vowed to smash the PKK, and authorities have imposed curfews in several towns in the region because of the fierce clashes.