Pakistan blast kills 3 US soldiers and 4 foreign journalists.
Three schoolgirls were among the dead while 70 people, including another 63 schoolgirls and two US soldiers, were injured in the explosion in Lower Dir.
The US embassy said the military personnel had been training Pakistan's Frontier Corps in counter-insurgency.
Both governments deny large numbers of US troops are in Pakistan.
The US embassy in Islamabad confirmed in a statement three American military personnel were killed and two wounded in what it branded a "vicious terrorist bombing".
The statement also said the Americans had been due to attend the inauguration of a girls' school recently renovated with US humanitarian assistance.
Azam Tariq, a spokesman for the Pakistani Taliban, Tehreek-e-Taliban, claimed responsibility for the attack in a statement to AFP news agency.
Military spokesman Maj Gen Athar Abbas told the BBC that the US personnel were attached to the Frontier Corps as military trainers.
Pakistan's Frontier Corps is a paramilitary force responsible for operations against militants in the volatile north-west, near the Afghan border.
The US soldiers were said to have been travelling in a convoy, along with Pakistani troops, that was heading to the inauguration of a newly built girls' school in Maidan, an area of Lower Dir district in the North West Frontier Province.
The bomb - which police said was activated by remote control - occurred near a different school in Koto, a heavily populated village along the route.
The impact flattened much of the Koto Girls' High School, leaving pupils crying for help under the rubble.
At least three of the dead were schoolgirls, police said, adding that security guards and three local journalists were also among the wounded.
News that three US soldiers were killed will be highly embarrassing for the Pakistani government, which is acutely aware of the unpopularity of its close ties to Washington.
Critics accuse Pakistani President Asif Ali Zardari of turning a blind eye to repeated American drone attacks in the north-west, which have killed more than 600 people during the past year, our correspondent says.
The US has argued in the past that its soldiers are in Pakistan to provide security for US citizens, he adds.
Last year, the Pakistani army carried out a major offensive to drive Taliban insurgents out of Lower Dir and the neighbouring districts of Swat and Buner.
But the Taliban are still present in remote areas and the latest attack shows that the militants remain a powerful force in the region, says the BBC's Mark Dummett in Islamabad.
Prime Minister Yousuf Raza Gilani also condemned the attack and ordered an investigation, the AFP news agency reports.
The Taliban has frequently targeted girls' schools in recent years, burning several to the ground. Many are now being rebuilt.
MSF Teams Treat Wounded After Explosion in Lower Dir.
Following the explosion in Lower Dir district, North West Frontier Province, Pakistan, on Wednesday, February 3, Ministry of Health and Doctors Without Borders/Médecins Sans Frontières (MSF) teams working in the emergency room in Timurgara district hospital received 126 wounded people, including children.
“Most of the wounded have shrapnel related injuries all over their bodies, on the face, abdomen and feet,” explained Dr.Ashraf Alam, medical officer for MSF in Timurgara. “We received 12 people in severe life threatening condition. Five of them have already undergone immediate surgery. It was a heavy blast and quite close to a school where children were going out for break time,” adds Dr. Alam.
In Lower Dir, MSF supports the district referral hospital in Timurgara. Some 1,100 patients are treated each week at the hospital’s emergency room, both by Ministry of Health and MSF medical teams, who take care of the patients most at risk and support the management of mass casualty response. MSF has set up a new operating theater, a post operating unit and put in place a sterilization and waste management system for the hospital.
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