About 1,000 people were evacuated following the blast just before midnight on Monday in the Tuscan seaside town of Viareggio, about 350 km (220 miles) north of Rome.
Thirty-seven people were serious injured, with 16 of them in critical condition, including a two-year-old who was badly burned and was being transferred to a hospital in Florence, rescue workers said.
It was Italy's most deadly rail accident since 17 people were killed in January 2005, when a passenger train collided with a freight train near the northern city of Bologna.
"The emergency and danger are not over. The area has been sealed off and search and rescue operations are ongoing," said Guido Bertolaso, head of Italy's civil protection agency.
"We have a convoy with four train wagons that are still carrying liquefied petroleum and are off the tracks, on their sides .... so the area is still at a really high risk level because the fire is still smouldering."
Firefighters battled overnight to contain blazes started by the explosion, which spread to nearby buildings and even set cars alight. The area around the tracks was blackened and some homes collapsed.
Rescue workers were trying to determine the whereabouts of some 30 people, registered living in buildings damaged or destroyed by the accident. But of these, only three or four people were feared buried, they said.
The civil protection agency pegged the number of dead at 14, compared to an estimate of 15 dead by rescue workers. the explosion and, as a precaution, were siphoning off liquefied petroleum gas from other, unexploded tanks in the wrecked train.
GATX Rail Europe, a unit of the US-based GATX Corp, which owns the rail cars - each one made of a gas tank attached to a wagon - told Reuters it did not know the cause of the explosion and was gathering information from news reports.
Chief Financial Officer Werner Mitteregger said the tanks being transported on the Italian railways were new.
Prime Minister Silvio Berlusconi called the episode "serious and upsetting" and was expected to visit the area on Tuesday.
At least two children were among the dead, officials said.
"Let me see him! Let me see him!" screamed one man trying to see his grandson, who was among the dead, ANSA news agency reported.
State railways said the accident occurred when one carriage derailed, pulling another four with it. Liquefied petroleum gas escaped from a tank on one of the carriages and caught fire.
14 killed as gas train explodes in town inferno