The plane carrying 67 passengers and four crew skidded off the runway while landing at the Tribhuvan International Airport (TIA).
Firefighters and ambulances had rushed towards the plane to rescue trapped passengers immediately after the incident, which took place on the eastern edge of the airport after the aircraft overshot the runway.
An aviation official said the plane lost control as it attempted to land.
Those on board include 12 Nepali tour agents who were returning after an annual sales conference in Bangladesh, an official said. Mahbubur Rahman of Bangladesh's civil aviation ministry said: "There might be technical problems on the aircraft".
"The plane flew past just above the air-traffic control tower during its descent for landing".
Back in 1992, there were two wide-body Airbus crashes in the nearby mountains, one of Thai International and another of PIA.
"Over 50 people are feared dead", Raj Kumar Chhetri, general manager of the airport, said.
"The plane was going up down, right and left, up down.so I thought that was some air traffic only".
Following the plane crash, authorities have closed the Tribhuvan International Airport. Adding that the plane became unstable while descending, officials said that they still have to ascertain the reason behind it. "All of a sudden there was a blast and then another blast".
One possibility the investigation committee will surely look is whether crash happened because of the steep turn.
It has been operating since 2014 out of its home airport in Bangladesh and flies to several domestic and global destinations.
Prime Minister KP Sharma Oli, Home Minister Ram Bahadur Thapa and Defense Minister Ishwar Pokharel visited the airport to oversee the rescue operation.
US-Bangla Airlines, which began operating almost four years ago, uses two types of aircraft. The parent company, part of US-Bangla Group, is involved in sectors that include real estate, education and agriculture.
The air crash has been regarded as a big shot to the tourism industry of the Himalayan nation, which is still recovering after the deadly natural disaster of 2015 killed almost 9,000 people.