The incident took place in the Matan Adezai area of the Khyber Pakhtunkhwa city and targeted the leader of an anti-insurgent group, senior police official Najeeb U Rehman told AFP.
"A suicide bomber hurled a hand grenade and then entered the house of Farman Ullah... Where he blew himself up," Rehman said, adding that Ullah was not injured.
Senior police official Nasir Khan confirmed the deadly attack and said he met Ullah at the residence after the incident.
The operation has been going on since Sunday and is expected to intensify when a three-day window to allow civilians to leave the area ends on Friday.
In the latest action, 15 militants were killed by helicopter gunships overnight and eight more by sniper fire while attempting to plant bombs on an important road, a statement from the military said.