About 50 separatist insurgents blew up a railway track and lobbed rockets at the Jaffar Express on Tuesday, which had more than 400 people on board, a security official said.
Hundreds of troops and teams in helicopters have mounted an operation to rescue hostages in the remote mountainous area where the train has been stopped.
The government said it has so far rescued 155 passengers.
There was no official word on how many people remained in the captivity of the militants.
The Baloch Liberation Army (BLA), an ethnic armed group that claimed responsibility for the attack, said on Tuesday it was holding 214 people hostage.
"People were attacked ... passengers were injured and some passengers died," said Muhammad Ashraf, who was on the train.
The train was trapped in a tunnel and the driver was killed after sustaining serious injuries, police and railway officials said.
The BLA has threatened to start executing hostages unless Baloch political prisoners, activists, and missing persons it said had been abducted by the military were released within 48 hours.
The group shared a message from one of its fighters on the train calling on people in Balochistan to join their fight against the Pakistani state.
"Comrades are shedding their blood for you, for this motherland," the man said in the message, posted on Telegram.
A security source told Reuters that there were 425 passengers on the train when it was attacked on its way from Quetta, Balochistan's capital city, to Peshawar in Khyber Pakhtunkhwa province.
The security source said that after taking control of the train, the insurgents began pulling passengers off and checking their identification.
"They were looking for soldiers and security personnel," the official said, adding that at least 11 people, including paramilitary troops, had been killed so far.
BLA militants with bombs strapped to their bodies were sitting next to other passengers, the source said.
BLA is the largest of several ethnic armed groups battling Pakistan's government in the mineral-rich province of Balochistan, bordering Afghanistan and Iran.
The security source said on Wednesday that 27 BLA fighters had been killed so far in the military operation.
On Tuesday, the BLA denied any of its members were killed.
Over 50 of those rescued so far were brought to Quetta by Wednesday morning, escorted by security forces, where their relatives were waiting for them.
Pakistan Railways has suspended all operations from Punjab and Sindh provinces to Balochistan until security agencies confirm the area is safe, local media reported on Wednesday.
Buledi told reporters the government was working to improve the security situation in the region.
