The explosion occurred in the Sancaktepe district on the Asian side of Istanbul close to military barracks in the area as a service vehicle carrying soldiers was passing.
The explosion was caused by a “remotely-detonated car bomb”, the office of Istanbul governor Vasip Sahin said in a statement, adding that an investigation had begun.
Those wounded in the blast were five soldiers and three civilians, one of whom was in a serious condition, NTV television said.
Television pictures showed the vehicle where the explosion took place was almost completely destroyed, with yellow flames rising from the debris.
The scale of the blast indicated that the toll risked being even higher, but reports indicated that the bomb had largely missed its apparent target.
The Dogan news agency said the explosion went off after the military vehicle had travelled some 20 metres (65 feet) from the site of the blast.
There was no immediate claim of responsibility for the car bomb.
The explosion comes with Turkey on edge after two deadly attacks in Istanbul this year blamed on Islamic State (IS) jihadists, and a pair of attacks in Ankara that were claimed by Kurdish militants and killed dozens.
Three people were killed Tuesday and 42 others wounded when a car bomb blamed on outlawed Kurdistan Workers Party (PKK) militants struck a police vehicle in the southeastern city of Diyarbakir.
The two attacks in Ankara were claimed by the Kurdistan Freedom Falcons (TAK) — a radical splinter group of the better-known PKK.
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