The latest maritime tragedy to hit the impoverished low-lying nation happened in the early hours in a river near Jhalokathi, 250 kilometres (160 miles) south of Dhaka.
"We have recovered 37 bodies. The death toll may rise. Most died from the fire and a few by drowning after many people jumped into the river," local police chief Moinul Islam told AFP.
The blaze was believed to have originated in the engine room and ripped through the ferry, Islam said. Despite having an official capacity of 310 the vessel was carrying at least 500 people, many of who were returning home from the capital.
"We have sent some 100 people with burn injuries to hospitals in Barisal," he said.
Witnesses said the fire originated at around 3:00 am (2100 GMT) and quickly spread.
"We were sleeping on a mat on the ground floor deck. All the passengers were sleeping. My nine-year-old grandson, Nayeem, was with me, he jumped into the river. I don´t know what happened to him," said an elderly grandmother.
Other survivors said they saw a small fire in the engine room as soon as the packed ferry set off from the Sadarghat river station in Dhaka at 9:00 pm on Thursday.
"A lot of people ran for safety as the fire spread. A lot of people could not get out of their cabins where they were sleeping. Many jumped into the river," said another survivor at Barisal Medical College Hospital.
Johar Ali, the local district administrator, said rescuers arrived at the scene within an hour after the fire broke out and rushed the injured to nearby hospitals.
"We spoke to passengers. And they said there were between 500 and 700 passengers," he told AFP.
"The fire went on for four or five hours before it was doused. The entire [ferry] has been gutted. But they managed to bring it to the shore," Ali said.
Local television showed images of burnt motorcycles and gutted cabins inside the boat.
Shell-shocked survivors and their relatives crowded the shore as fire service and coast guard divers scoured the muddy waters.
The accident was the latest in a string of similar incidents in the delta country crisscrossed by rivers.
Experts in the South Asian nation of 170 million people blame poor maintenance, lax safety standards at shipyards and overcrowding.
In August at least 21 people were killed when a boat packed with passengers and a sand-laden cargo ship collided. In April and May, 54 were killed in two separate accidents.
In June last year, a ferry sank in Dhaka after it was hit from behind by another ferry, killing at least 32 people. In February 2015, at least 78 people died when an overcrowded ship collided with a cargo vessel.
Fires are also a regular source of tragedy. In July, 52 people perished in a blaze in a food and beverage factory in Rupganj, an industrial town outside Dhaka.
And at least 70 people died in February 2019 when fire tore through Dhaka apartments where chemicals were illegally stored.
Pakistan saddened by loss of lives: MOFA
A statement issued by Ministry of Foreign Affairs of Pakistan expressed grief over the unfortunate incident and offered condolences to the affected families and Bangladesh on the country's behalf.
The MOFA also expressed solidarity and support with the people of Bangladesh in their moment of grief.
"Government and people of Pakistan are deeply saddened by the loss of precious lives in a ferry accident in Jhalakathi district in Bangladesh. Our deepest condolences to the bereaved families and the Government of Bangladesh," the statement read.
At this moment of grief, our thoughts and prayers are with the brotherly people of Bangladesh, it added.
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