The state carrier said flight PK 8303 had crashed with 99 passengers and eight crew members on board, though civil aviation officials said the total for both may be 99.
"The last we heard from the pilot was that he has some technical problem," PIA spokesman Abdullah H. Khan said in a video statement. "It is a very tragic incident."
A senior civil aviation official told Reuters it appeared the plane was unable to open its wheels due to a technical fault prior to landing, but it was too early to determine the cause.
Video showed crowds near the scene, which appeared to be a densely populated area, and ambulances trying to make their way through.
Black smoke billowed and several cars were on fire.
The Pakistani army said its quick reaction force and paramilitary troops had reached the site for relief and rescue efforts alongside civil administration bodies.