China's Ministry of Public Security called the attack in the regional capital of Urumqi a "serious violent terrorist incident" and domestic security chief Meng Jianzhu vowed to strengthen a crackdown on the "arrogance of terrorists". (Agencies)
China has blamed a series of knife and bomb attacks in recent months on separatist militants from Xinjiang, the traditional home of the ethnic Muslim Uighurs.
The cross-country vehicles rammed into shoppers in an open market, a state news agency reported, citing witness reports. Explosives were flung out of the vehicles, and one of the vehicles exploded.
One witness said he saw the aftermath of the blasts on his way to work.
"The air was full of the smell of gunpowder and the sound of sobbing," he said.
"There were simply too many (casualties), old folks who were at the morning market."
A business owner said he had heard a dozen loud explosions.
The blasts occurred at a market near Renmin Park in downtown Urumqi.
Xinjiang has been plagued by violence for years but rights activists and exile groups say the government's own heavy handed policies in the region have sowed the seeds of unrest.
Photos posted on social media purportedly of the blast, but not verified by Reuters, showed a column of smoke and chaos at the market, with bloodied people lying on the tree-lined road near small stands selling fruit, vegetables and eggs.
"There were two vehicles that drove like crazy towards the morning market," another witness who declined to give his name said.
"The market was total chaos. Hawkers and shoppers started running everywhere... it was definitely a terrorist act. I'm so angry,” he added.
Other photos showed riot police on the scene and bodies lying amid flames. Produce and debris were scattered across the street.
Exile group the World Uyghur Congress and officials with the Xinjiang government could not be immediately reached for comment.
The attack was the deadliest in a recent series targeting crowded public places in China. In March, 29 people were stabbed to death at a train station in the southwestern city of Kunming.
A bomb and knife attack earlier this month at an Urumqi train station killed one bystander and wounded 79.
A car burst into flames at the edge of Beijing's Tiananmen Square in October, killing five people, in what Beijing said was a terrorist attack.
China has said Islamist militants from Xinjiang carried out the attacks. Separatist groups in Xinjiang are seeking to form their own state called East Turkestan.
Xinjiang, resource-rich and strategically located on the borders of central Asia, is home to the Uighur people, a mostly Muslim ethnic group who speak a Turkic language and are culturally distinct from China's ethnic Han majority.
Violent riots shook the region in 2009, when hundreds of locals took to the streets in Urumqi, burning and smashing vehicles. Dozens were killed in the unrest.
But exiles and rights groups say China's repressive policies that have targeted religious freedoms and economic opportunities for Uighurs are the culprits when it comes to unrest.
In recent weeks, China has strengthened a crackdown on Uighurs in the region, jailing dozens for spreading extremist propaganda and manufacturing arms, among other charges.
Christopher Johnson, a former China analyst at the CIA, said China's leadership may come to the realisation that a policy of constantly tightening controls on Xinjiang may not be effective in preventing attacks.
"I'm kind of doubtful that they are going to announce some sort of more liberal policy," said Johnson, who now works at the Center for Strategic and International Studies in Washington.
"But sooner or later I think they are going to have to come to that reality because the evidence is just smacking them in the face."
China's Ministry of Public Security called the attack in the regional capital of Urumqi a "serious violent terrorist incident" and domestic security chief Meng Jianzhu vowed to strengthen a crackdown on the "arrogance of terrorists".