Two suffered serious injuries, including a woman in her early 20s who sustained severe burns to her head, neck and chest when she was blown out of the first floor of the building. Emergency services found her lying in the street outside the building in Shrewsbury, Shropshire, and airlifted her to Birmingham's Selly Oak Hospital.
A man believed to have become trapped by rubble on the ground floor was taken to the Royal Shrewsbury Hospital with suspected spinal injuries, an ambulance service spokesman said.
Superintendent Peter Lightwood of West Mercia Police said it was a surprise no-one had been killed in the incident, which occurred on Sunday morning near Welsh Bridge.
He said officers were on site within two minutes and found a "scene of total devastation".
He said: "The cause of the explosion is unknown. We are aware that the casualties woke to the smell of gas." He added that the explosion had "completely flattened" the building.
A fire service spokesman confirmed there had been "quite a significant gas leak" but added that it was possible for this to have been caused by the explosion.
He said: "We're on a Sunday, a quiet Sunday after Christmas, after New Year's (Eve] is over.
"Luckily, I would say, it has been a very quiet period. If this had been prior to Christmas, when the shops and the streets and the pubs were a lot busier, then it could have been a significantly worse incident."