The attacker detonated his explosives as he drove by the main entrance to the Vladikavkaz market, according to the Emergency Situations Ministry.
At least 15 people, including the suicide bomber, were killed and 133 were wounded in the explosion, said Alexander Pogorely of the Emergency Situations Ministry's branch in southern Russia. He said 87 of the injured were hospitalized, many in grave condition.
Russian television stations showed a shrapnel-littered square in front of the market, with blood stains on the pavement and rows of vehicles scarred by the blast.
Vladikavkaz is the capital of the Russian republic of North Ossetia. Although it is less plagued by violence than some other republics in the region such as Chechnya and Dagestan, North Ossetia has suffered ethnic tensions and frequent terror attacks.
It was the scene of the 2004 Beslan crisis, in which Chechen terrorists took hundreds of hostages at a school — a siege that ended in a bloodbath killing more than 330 people, about half of them children.
The Vladikavkaz market was bombed in 1999, killing 55. Another bombing in 2001 killed six people. In 2004, 11 people died when a minibus stopped near the market was bombed.
Unlike most other Caucasus provinces where Muslims make up the majority of the population, North Ossetia is predominantly Orthodox Christian. It has been destabilized by long-simmering tensions between ethnic Ossetians and ethnic Ingush that exploded into an open fighting in 1992.
The market attack came as Muslims were preparing to celebrate Eid al-Fitr, a holiday marking the end of the holy month of Ramadan.