There are contradictory reports over the gender of the bomber, amid official claims it was a woman.
A suspected female suicide bomber killed at least six people when she attacked a bus in the city in October.
Moscow is concerned militant groups could be ramping up violence in the run up to the the 2014 winter Olympic Games in the city of Sochi in six weeks.
Sunday's explosion rocked Volgograd-1 station at around 12:45 (08:45 GMT) at a time when millions of Russians are travelling to celebrate the New Year.
A nearby security camera facing the station caught the moment of the blast, showing a bright orange flash behind the station's main doors.
The explosion shattered windows and sent debris and plumes of smoke from the station entrance.
Motionless bodies were laid out in the station forecourt while ambulances rushed those hurt to hospital. About 40 people are said to have been injured, including a nine-year-old girl whose mother was killed in the attack.
Russian President Vladimir Putin ordered law enforcement agencies to take "all necessary security measures" in the bomb's aftermath, said a Kremlin spokesman.
He ordered the most gravely injured victims to be flown to Moscow for treatment.
Security would be stepped up at train stations and airports, said a federal police spokesman.
No group has yet claimed responsibility for the blast, but a spokesman for Russia's Investigative Committee, Vladimir Markin, said the incident was being treated as an act of terrorism.
An Islamist insurgency in the North Caucasus region has led to many attacks there in recent years. Insurgents have also attacked big Russian towns.
Volgograd lies about 900km (560 miles) south of Moscow, 650km north of the North Caucasus and 700km north-east of Sochi.
The bomb used in the attack contained 10 kg (22 pounds) of TNT, was rigged with shrapnel and was detonated near the metal detectors at the station entrance, Mr Markin said.
"According to our information, the explosion was carried out by a female suicide bomber who approached a metal detector, saw a policeman there, got nervous and detonated the bomb stuffed with pieces of shrapnel," said Mr Markin.
He said the security presence had prevented a much higher death toll at the station, which was packed at the time of the blast as several trains were delayed.
RIA Novosti news agency said security sources were naming the attacker as Oksana Aslanova. She has reportedly been married twice to militants and is also suspected of being a friend of Naida Asiyalova, the suicide bomber who targeted the Volgograd bus in October.
However, the Interfax news agency later quoted an unidentified security source as saying "it has been established that the suicide terrorist was a man who had brought explosives to the station in a rucksack.
"His identity has been established," the source said, though he did not give details.
The agency said the suspect's head had been found at the site.
In July, Chechen insurgent leader Doku Umarov posted an online video urging militants to use "maximum force" to prevent the Games from going ahead.
On Friday, a car bomb killed three people in the southern Russian city of Pyatigorsk.
Source: BBC News
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