Some reports say that the market explosion was triggered by a girl suicide bomber who may have been as young as 10 years old.
No group has so far claimed responsibility for Saturday’s attack.
However, correspondents say that all the signs point to the militant Islamist Boko Haram group.
The market is reported to have been targeted twice in a week by female bombers late last year.
Borno State police spokesman Gideon Jubrin said that the girl suicide bomber let off an improvised explosive device near the area of the market where chickens were sold.
Hundreds of people were killed on January 7 in an assault by Boko Haram militants on the town of Baga, following on their seizure of a key military base there on January 3.
Scores of bodies from that attack – described by Amnesty International as possibly the “deadliest massacre” in the history of Boko Haram – are reported to remain strewn in the bush.
District head Baba Abba Hassan said most victims in the Baga attack were children, women or elderly people who were not able to escape when insurgents forced their way into the town by firing rocket-propelled grenades and assault rifles.
“The human carnage perpetrated by Boko Haram terrorists in Baga was enormous,” Muhammad Abba Gava, a spokesman for a civilian defense group that fights Boko Haram told the Associated Press .
Boko Haram launched a military campaign in 2009 to create an Islamic state.
The group has taken control of many towns and villages in north-eastern Nigeria in the last year.
The conflict has displaced at least 1.5 million people, while more than 2,000 were killed last year.
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