"The prayer leader was giving a sermon when we heard firing and blasts. Everybody stood up and then two gunmen barged into the mosque and sprayed bullets," Fateh Sharif, a 19-year-old student, told Reuters from Model Town.
"They had long beards. They were carrying rucksacks."
Bhutta said a suicide vest laden with explosives was recovered from the Model Town mosque, where some attackers escaped. One fired at a television van before the area was made safe.
"He was young, clean-shaven. He sprayed bullets at our van while fleeing the scene," Rabia Mehmood, a reporter for Express Television, told Reuters.
ATTACKS LAUNCHED AFTER PRAYERS
Witnesses said the assaults were launched shortly after prayers.
"I saw some gunmen run towards the Ahmadis' place of worship and then I heard blasts and gunfire," Mohammad Nawaz, a resident, told Reuters.
Stock market investors shrugged off the latest violence.
"Initially we saw some selling after the attack but investors started accumulating shares at lower levels," said Asad Iqbal, chief executive at Faysal Asset Management Ltd adding that there was foreign buying which boosted local confidence.
The Karachi Stock Exchange (KSE) benchmark 100-share index was up 0.75 percent at 9,511.75 points at 4:05 p.m. (1105 GMT).
Ahmadis are a minority Muslim sect founded in the late 19th century. They hold unorthodox beliefs among Muslims, including that Jesus Christ survived the crucifixion and died in Kashmir. Some also believe that prophets have come after Mohammad, the founder of Islam, but that he retains his primacy.