Zahra Shahid Hussain, the 60-year-old vice-president of the party's Sindh unit, was shot by two unidentified men outside her home in Defence Phase IV Saturday night.
She died while being taken to a nearby hospital.
Zahra, a mother figure for party workers, was a member of the party's central executive committee.
The motive for the murder could not immediately be ascertained. The killers escaped on a motorcycle.
"The assailants opened fire on Zahra at the gate of her residence. Apparently they were there to target her only", a police official told Geo News.
Her murder came a day before re-polling at 43 stations on Sunday for the national assembly seat of NA 250 constituency which the MQM has boycotted.
Cricketer-turned-politician Imran Khan immediately held MQM chief Altaf Hussain directly responsible for the killing.
"I hold Altaf Hussain directly responsible for the murder as he had openly threatened Pakistan Tehrik-e-Insaf workers and leaders through public broadcasts," Imran said in a statement from his hospital bed late Saturday night.
Khan said Altaf Hussain had been issuing threatening statements against his party leaders and workers since the elections on May 11.
A senior police official said they were investigating from two angles whether it was a target killing or a deadly reaction to a robbery attempt.
The Election Commission ordered the re-polling following several days of protests by the Pakistan Tehrik-e-Insaf and other parties over rigging in the constituency during polls.
Khan further held the British government responsible, claiming that the UK had been warned to act against Altaf Hussain following open threats to kill his party workers.
Hussain has lived in London in self-exile since 1993.
Shortly after the incident, the MQM chief issued a statement where he condemned the murder and demanded that the government immediately arrest the culprits.
SP Clifton Division Nasir Aftab said that initial findings pointed to a case of a purse snatching gone wrong.
Shortly after the incident, a large number of Pakistan Tehrik-e-Insaf workers gathered outside the National Medical Centre, where Zahra had been brought for treatment.
Image: The body of Zahra Shahid Hussain is carried at a hospital in Karachi in this video grab.
Photograph: Reuters
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