A senior Kabul police official said a suicide bomber attacked the shrine in the center of the Afghan capital, where hundreds of people had gathered to celebrate the Shi'ite religious festival of Ashura.
Police said in the latest announcement that the Kabul blast had killed at least 54 people and injured more than 150 others.
Naseem Shafaq, a correspondent for RFE/RL's Radio Free Afghanistan, was near the scene of the attack in the Murad Khani neighborhood and spoke of a horrific scene minutes after the bomber struck, with many bodies ripped to pieces.
The attack is one of the deadliest against Kabul civilians since the fall of the Taliban a decade ago, and a rare attack specifically targeting Afghanistan's minority Shi'ite community.
Meanwhile, a bomb explosion near a mosque in the northern city of Mazar-e Sharif killed at least four people.
RFE/RL's Radio Mashaal reported that a Pakistan-based militant group linked to Al-Qaeda claimed responsibility for the attack. If confirmed, this would be the first known attack by the Sunni extremist group, Lashkar e-Jhangvi al-Alami, in Afghanistan.
The Taliban earlier denied it was behind the attack, condemning it as the work of "enemies."
The attacks came one day after Afghanistan's Western allies gathered in Bonn to pledge long-term support after their combat troops leave at the end of 2014.
Afghan President Hamid Karzai, who was still in the German capital, deplored the of the attacks as terrorism of a "horrible nature."
"Thank you very much also for your very encouraging words, sympathy, and condolence for the victims of the terrorist [attacks] today in Kabul and also in Mazar-e Sharif, which is the first time that on such an important religious day in Afghanistan, terrorism of that horrible nature is taking place," Karzai said. "We all wish the best for those who were injured and quick recovery and patience to the families who have lost their dear ones."
Karzai canceled a visit to Britain to return to Afghanistan.
Sectarian violence flares occasionally between Sunnis and the minority Shi'a in Afghanistan, but in recent years the country has been spared large-scale sectarian attacks.
VIDEO: Hundreds of worshippers observe the festival by beating themselves with steel-tipped flails in Kabul (by RFE/RL's Radio Free Afghanistan)
Shi'a are celebrating the festival of Ashura, which marks the death of the Prophet Muhammad's grandson, Hussein, in the battle of Karbala in Iraq in the year 680.
based on RFE/RL and agency reports