Residents of the small town of Bororen were told to leave immediately by Queensland Police after a B-double tanker carrying 42 tons of ammonium nitrate crashed head-on with another vehicle on a nearby highway, causing a major explosion.

The driver of the second vehicle was killed, authorities confirmed, and the truck driver who was pulled out from the vehicle by bystanders shortly before it ignited was airlifted to a hospital with serious abdominal and leg injuries, Xinhua news agency reported.

An exclusion zone was put in place around the site of the crash, with all residents within the zone told to self-evacuate. Those who could not leave were told to shelter indoors, close all windows and doors, and turn off air conditioning units.

Queensland Police Acting Superintendent Mark Burgess said the explosion blast radius was approximately 500 metres.

"Just after 9.40 a.m., a blast was heard and felt and there was a visible large cloud of smoke," he said at a press conference.

No other people were injured and no property was damaged but power lines were down and spot fires were ignited along a nearby rail corridor.

The Bruce Highway, a major highway linking Brisbane to the far northern city of Cairns, was closed in both directions.

The Australian Broadcasting Corporation reported that Queensland Fire and Rescue was conducting scientific testing, including atmospheric assessment, at the site of the explosion.

John Hodson-Gilmore from the Queensland Ambulance Service said the first paramedics to arrive at the scene were faced with an extensive damage area.

He said fire crews made the decision not to attempt to extinguish the truck fire shortly before it exploded.

Ammonium nitrate is predominantly used in agriculture as a fertiliser.