10 Iranian guards were injured in the attack which reportedly targeted a bus carrying security forces.
The attack happened on the road between the cities of Zahedan and Khash, a volatile area near the Pakistan border where militant groups and drug smugglers frequently operate.
The latest attack, one of the deadliest ever carried out against the top military force, comes as Iran is trying to parry what it sees as a US-led war on its economy after Washington re-imposed crippling sanctions against the country.
In September past year, Isis militants and an Arab group claimed responsibility for a deadly assault on a military parade, also in the country's south, that killed and wounded dozens of people, including members of the Guards.
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Two people were killed and around 40 wounded in the port city of Chabahar in early December, in an attack Zarif blamed at the time on "foreign-backed terrorists", a reference to Sunni Muslim extremists.
Both official and semi-official Iranian media outlets blamed Wednesday's bombing on Jaish al-Adl, or "Army of Justice", saying the group had claimed the attack.
A coordinated June 7, 2017 Islamic State group assault on Parliament and the shrine of Ayatollah Ruhollah Khomeini, the leader of Iran's Islamic Revolution. In September, Iran fired missiles into Iraq targeting a base of an Iranian Kurdish separatist group after an attack on a border post.
Iranian Foreign Minister Mohammad Javad Zarif appeared to blame the United States for the attack, citing a US -sponsored conference in Warsaw aimed at rallying support to further isolate Iran. Trump withdrew the USA from the accord last May.
On Twitter he asked: "Is it no coincidence that Iran is hit by terror on the very day that #WarsawCircus begins?"
Iranian Foreign Minister Mohammad Javad Zarif predicted the Warsaw summit would not be productive for the U.S.
"About the United States, the resolution of any issues is not imaginable and negotiations with it will bring nothing but material and spiritual harm", Khamenei said in a statement.