ISLAMABAD, Pakistan (CNN) -- Three suspects were arrested after an explosives-packed van reduced a police building to rubble Wednesday in eastern Pakistan, killing 27.
The scene of an apparent suicide car bomb attack on a police building in Lahore on May 27.
The morning attack in Lahore -- Pakistan's second-largest city -- also wounded more than 250 people, most of them police officers and staffers, authorities said. Fourteen of the dead included police officers.
Three others were identified as bodies of "terrorists," said City Commissioner Khusro Pervez.
Immediately after the blast, police arrested two of the suspects, said City Commissioner Khusro Pervez. Local television showed the men being led away by officers.
Sir Ganga Ram hospital, which was damaged by the explosion, was treating 128 victims.
Authorities expected the death toll to rise as rescue workers picked through twisted metal and other debris from the building, looking for more bodies. Watch more on the attack »
The attack comes amid a Pakistani military offensive to rout militants from their haven in the northwestern part of the country.
Baitullah Mehsud, the leader of the Pakistan Taliban, had threatened to target major Pakistani cities if the operations did not cease.
"The enemies of Pakistan are trying their very best to use every venue to destabilize the country," Interior Minister Rehman Malik told reporters Wednesday.
The blast occurred on Mall Road near the city police headquarters and the high court. It is one of Lahore's busiest areas.
A passenger van, laden with explosives, broke through a security barrier and was headed toward the police building when guards opened fire to stop it, said Lahore's district coordination officer, Sajjad Ahmed Bhutta. Watch rescue workers respond to the scene »
The two sides exchanged gunfire, with the attackers hurling grenades, said Faisal Gulzar, deputy police superintendent.
The van exploded before it could reach the building. It was carrying an estimated 100 kilograms (220 pounds) of explosives, Bhutta said.
The impact was immense.
The targeted building -- Building 15 -- collapsed. It housed the city's rapid response team, which is dispatched during emergencies.
At least 50 people were thought to have been inside the two-story building at the time, said police spokesman Ray Nazar Hayat.
The police headquarters that sits adjacent to the building was also damaged. Motorcycles from a nearby dealership were strewed about, charred from the heat.
The roof of four operating rooms caved at Sir Ganga Ram Hospital, with 40 medical staff members suffering minor wounds.
Police waved away onlookers in vain. Many of them jumped over the collapsed walls of Building 15 to look for survivors. Semi-conscious officers in blood-stained uniforms were pulled from under wooden planks.
No group immediately claimed responsibility for the attack, with suspicion falling on the beleaguered Islamic militants in the northwest who had vowed revenge.
"We're doing our best," Malik, the interior minister, said of the offensive in the northwest. "Please do not forget we're in a state of insurgency. It's a fight for our survival. We had two choices: We surrender our country or we save it for our next generation."
Lahore is Pakistan's cultural capital, far removed from the fundamentalist interpretation of Islam that is embraced in the north of the country, which borders Afghanistan.
Still, it has sporadically been swept into widening Islamist violence that grips the country.
In March gunmen hurled grenades and opened fire on officers at a police training center, killing at least seven cadets.
The same month gunmen opened fire on a bus carrying members of the Sri Lankan national cricket team on their way to a stadium for a match. The attack wounded at least eight members of the team and killed a driver and six Pakistani police officers.
"Everywhere in the city is insecurity," Haris Nadeem, a student in Lahore, said Wednesday. "You never know when a blast is going to occur or where. A shopping center? A government office?"
Still, said Saleem Khan, residents forge ahead
"We will avoid places when they are crowded, but we can't change everything," he said. "We can't stop going out of our houses. Life has to go on."
CNN's Ingrid Formanek and Saeed Ahmed and journalists Zeeshan Ali Taher and Naser Habib contributed to this report.
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