Officials said there were casualties among the 20 passengers and seven crew members but refused to confirm reports of several deaths as plumes of smoke rose from the site.
A fireman on the scene told the The Associated Press they had recovered nine bodies from the plane. He spoke on condition of anonymity because he is not authorized to give information to reporters.
Five survivors among 20 passengers have been rushed to the hospital as rescue efforts continued after the crash which happened at 9:20 a.m. (0820 GMT) Thursday, said Federal Aviation Agency spokesman Yakubu Dati.
"We have put out the fire and our priority continues to be rescuing survivors," he told The Associated Press hours later.
The front of the aircraft was completely destroyed, indicating it was the first part to hit the ground. The wrecked remains, surrounded by security officers and rescue workers, lay about 30 meters (yards) from massive tanks storing aviation fuel.
Local news reports said the plane was carrying mourners and the body of former Ondo state Gov. Olusegun Agagu, who died on Sept. 13.
Dati said Agagu's casket and the black box that records data from the aircraft had been recovered. He said the plane was a Brazilian-made turboprop Embraer-120.
Police Commissioner Waheed Sanau said the plane was chartered from Associated Airline to fly from Lagos to Akure in Ondo state and crashed into open land near a tollgate shortly after taking off.
The pilot detected a fault soon after taking off and tried to return to the airport for an emergency landing but did not make it, said another police official, who spoke on condition of anonymity because Lagos airport is not included in his duties. He said aviation officials were discussing a possible engine failure.
Nigerian airlines and airports have a notoriously poor safety record.
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