The bus was on its way to the Shiv Khori cave temple when it came under attack. As the terrorists opened fire, the bus fell into a gorge.
"Nine pilgrims have died and 33 are injured," Vishesh Mahajan, District Magistrate of Reasi, told NDTV.
The driver lost control of the bus in the firing and fell into the gorge, Reasi's Senior Superintendent Of Police Mohita Sharma said, reported news agency ANI.
"Initial reports suggest that terrorists fired upon the passenger bus... Due to the firing, the bus driver lost balance of the bus and it fell into the gorge. Thirty-three people were injured in the incident. The rescue operation has been completed. The identities of the passengers have not been confirmed yet. They are not locals. Shiv Khori shrine was secured and area domination was done," she said.
Visuals from the site showed some bodies scattered along a hillside and the damaged bus.
Locals were seen helping in rescue operations and ambulances were lined up.
Police, army, and paramilitary forces were rushed to the spot, the police said.
The attack marks a significant escalation in violence in the region. Reasi district has been relatively untouched by terrorist activities compared to neighbouring Rajouri and Poonch.
Prime Minister Narendra Modi, who took oath at a grand ceremony this evening that was attended by over 8,000 dignitaries, took stock of the situation in Jammu and Kashmir after a terror attack on pilgrims in the Reasi district killed nine people and injured 33 others, Lieutenant Governor Manoj Sinha said.
"Prime Minister Narendra Modi took stock of the situation and directed me to constantly monitor the situation and to ensure all possible assistance to the families," Mr Sinha said in a post on X.
"I strongly condemn the cowardly terror attack on a bus in Reasi. My condolences to the family members of the martyred civilians. Our security forces and police have launched a joint operation to hunt down the terrorists," he said.
"All those behind this heinous act will be punished soon. The PM has also directed that all the injured are provided the best possible medical care and assistance."
President Droupadi Murmu condoled the deaths of pilgrims in the terror attack. "I am deeply distressed to learn of a bus accident in the Reasi district of Jammu and Kashmir in which a number of pilgrims have died. My condolences to the families of the victims. I pray for the speedy recovery of the injured," she wrote on X.