The Helmand governor’s office said 23 civilians were killed and at least 15 others wounded after four Taliban rockets hit a festival being held in Sangin district market on Monday.
The militants also detonated a car bomb nearby, the statement said.
According to the governor’s office, the incident happened in the Zol Bazar area and two Taliban members were also killed.
The car bomb blast was in a more residential area and damaged civilian houses and injured some people.
Helmand Governor Mohammad Yasin Khan assigned a security team to probe the incident.
Earlier, media reported that Afghan forces were responsible for the mortars fired at the market.
However, the Helmand media office denied the Afghan forces’ involvement in the attack and said Taliban had previously attacked security personnel in the area.