Joseph Tulya, Katango regional police spokesperson, told Xinhua by telephone that the Rwandan registered Trinity bus burst into flames at Buwama along the Masaka-Kampala Highway.
The bus with 50 passengers on board was travelling from the Rwandan capital Kigali to Ugandan capital Kampala.
"When it reached the place near Buwama police check point, smoke started coming out and eventually it caught fire," said Tulya.
"All these passengers managed to escape without any injury. But all their properties got burnt in the bus," the police spokesman added.
He said the cause of the accident is still unknown and investigations are underway.