The bus was carrying about 60 children from a nursery school when it was hit by a train near Manfalut, 350 km (230 miles) south of Cairo.
The Egyptian transport minister has resigned, state media report.
Reports from witnesses say the barriers of the crossing were opened when the bus approached.
“The deaths have now reached 47. There are 13 children injured,” Assiut state governor Yehya Keshk told state television.
Egyptian President Mohammed Mursi ordered his ministers to offer support to the families of those killed, the state news agency reported.
“They told us the barriers were open when the bus crossed the tracks and the train collided with it,” doctor Mohamed Samir told the Reuters news agency, citing witness accounts.
The head of the state railway authority has also resigned.
Distraught families are searching for the remains of their loved ones along the tracks, the Associated Press reports.
Egypt’s roads and railways have a poor safety record. An estimated 8,000 people die in car accidents each year in the country.
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