Workers at the shop tried to cut the bomb open believing that it has been defused when the blast ripped them off.
Five of the workers died on the spot while several others were admitted to hospital.
The blast brought down the building housing the scrap shop and damaged dozen of homes within a 500-metre radius, The Bangkok Post reported.
Body parts were found as far as 200 metres from the scene.
The bomb may have come in with the soil used to fill the site before construction began.
The allies conducted bombing raids on the Thai capital in retaliation for the kingdom joining the Japanese war effort in Southeast Asia.