The blast was caused by a computer tablet exploding in the cramped carriage.
The device injured its owner, believed to be a woman who was carrying it in her bag, and at least five more people sitting nearby.
And more had to be assisted by paramedics for smoke inhalation, according to El Mundo.
The explosion happened on a Line 9 train travelling towards Paco de Lucia at Principe de Vergara tube station in the Spanish capital.
Police and paramedics rushed to the scene to assist the casualties.
A spokeswoman for Emergencies Madrid said members of the staff were helping 17 passengers deal with the shock.
According to El Mundo, Spain’s second-largest newspaper, the explosion sparked panic across the train, with commuters afraid of being the target of a terrorist act.
Nine people were assisted by doctors after suffering from panic attacks, the newspaper added.
Gonzalo Casatejada, 33, told Spanish daily El Pais: “People started running, they said there was a backpack with smoke.
“We opened the door manually, we had been standing for several minutes, but people got scared and everybody started to run.
“We were afraid that it would be an attack.”
People inside the carriages activated the emergency brake to leave the train, walking in the darkness along the track for approximately 100 metres, where they found the platform.
Following the blast, the underground service was immediately halted between Sainz de Baranda and Avenida de America to investigate into what caused the explosion – but it was later restored.
Commuter Juan Teixera took to Twitter in the immediate aftermath to alert social media users.
He wrote: “A tube was evacuated because a tablet exploded. Half an hour trapped inside.”
Police ruled out the blast was in any way connected to an act of terrorism.
Madrid’s underground trains have been the target of the 2004 train bombing, a terrorist act which killed 192 people and injured more than 2,000.