The balloon was at 300m (1,000ft) when it caught fire and plunged into fields west of the ancient city.
At least two people, including the balloon's pilot, are reported to have jumped out of the balloon before it crashed.
Officials in Luxor say they have now banned all hot air balloon flights.
People were jumping out of the balloon from about the height of a seven-storey building
Witness Cherry Tohamy
The UK Foreign Office said that two British nationals and one British resident had died. One of them was said to have undergone five hours of surgery in an effort to save his life, but died of his injuries. Another Briton is in a stable condition in hospital.
"The next of kin have been informed and our thoughts are with them and their families at this difficult time. We are providing them with consular assistance," it said in a statement.
The dead also included nine Hong Kong tourists, four from Japan, two French, one Hungarian and an Egyptian, Egypt's health ministry said.
The Chinese and Japanese embassies in Cairo, and the French foreign ministry, also confirmed that their nationals were among those killed. The Hungarian is understood to have been the British resident who died.
The pilot, who is being treated for burns, survived by jumping when the balloon was just 10-15m (33-49ft) above ground, a local ballooning official told Reuters news agency.
Luxor lies on the banks of the River Nile in the south of the country, and has long been a popular tourist destination.
It is home to some of Egypt's most famous ancient ruins, with the temples of Karnak and Luxor in the city itself and the tombs of famed pharaohs - including Tutankhamen - in valleys nearby.
Map of balloon crash site in Luxor, Egypt
The governor of Luxor, Ezzat Saad, told the BBC he wanted to send his condolences to the families of those killed and injured.
"We have never seen anything quite like this in Luxor before. It is an awful thing," he said.
"For the safety of the tourists and the Egyptians I have ordered all the companies dealing with balloons to stop flights until we know exactly what happened and the reasons for it."
The crash happened on one of the many dawn hot air balloon flights that give tourists an aerial view of Luxor's famous sites, such as Karnak temple and the royal tombs in the Valley of the Kings.
The balloon's operating company, Sky Cruise, said a gas cylinder exploded on board, bringing it down in sugar cane fields just west of Luxor.
Cherry Tohamy's balloon was landing when she heard an explosion and saw flames from a balloon above
"Our pilot told us that the balloon had hit a high pressure electrical cable and a cylinder on board exploded," said Ms Tohamy, an Egyptian living in Kuwait who was on holiday in Luxor.
"People were jumping out of the balloon from about the height of a seven-storey building."
Alaa Mahmoud, a sales manager for another local balloon company, Magic Horizon, told the Guardian newspaper that the accident happened as crews tried to anchor the balloon to the ground using ropes hanging from the basket. The ropes became entangled in the tubes leading to the gas cylinder and severed them, after which the gas was ignited, he added.
"The flames were so strong that the pilot and one guy jumped," he said. "When they jumped, the balloon lost balance and the balloon went up again."
An investigator with the state prosecutor's office also told the Associated Press that a landing cable had got caught around a helium tube.
Another witness, US photographer Christopher Michel said his balloon was just about to land when he "heard an explosion and saw smoke".
The area has been cordoned off by police and investigators are inspecting the charred remains of the balloon.
Egypt's civil aviation minister has reportedly flown to Luxor to head the investigation into the crash.
Hot air balloon crashes have happened in Luxor before. Two British women were among 16 injured when their balloon came down after hitting a communications tower in April 2009.
Balloons were grounded for six months after that crash while safety measures were tightened up and pilots re-trained.
But, says the BBC's Aleem Maqbool in Cairo, since the 2011 revolution that toppled President Hosni Mubarak, the rule of law is not being respected in many aspects of Egyptian life, so it has been difficult for the tourism ministry to impose its authority on sites like this.
Luxor, like many other parts of Egypt, has seen a sharp downturn in visitor numbers during the two years since the uprising.
氣球是在 300 米 (5000 英尺) 時它著了火,陷入在古代城市西邊的欄位。據報導,至少兩人,包括氣球飛行員跳出氣球墜毀前的了。在盧克索的官員說,他們現在已經禁止所有熱氣球飛行。人都跳出氣球從七層樓的高度見證櫻花哈密英國外交部說,兩名英國人和一位英國居民已經死了。其中之一是說經歷了五個小時的手術,以挽救他的生命,但因傷死亡。另一個英國人是在醫院,情況穩定。"近親已被告知,我們的思想與他們和他們的家人在這艱難的時刻。它在一份聲明中說: 我們有為他們提供領事協助,"。死者中還包括九 Hong 香港遊客,四個來自日本,兩個法國,一名匈牙利人和埃及人,埃及衛生部說。在開羅和法國的外交部長,中國和日本大使館也證實其國民均遇難。據瞭解,匈牙利已經去世的英國居民。試點,正在接受治療燒傷,靠跳氣球在地面上,只是 10-15 米 (33 49 英尺) 時當地膨脹官員告訴路透通訊社。盧克索位於尼羅河在該國南部的銀行,長期以來一直受歡迎的旅遊目的地。它是埃及的最著名的古代遺址,寺廟的卡納克神廟和盧克索市本身的一些國內外著名法老圖坦卡蒙-包括在山谷附近的墓葬。匹配的氣球墜機地點在埃及盧克索的電子地圖盧克索,埃薩德薩阿德,總督告訴 BBC,他想要送去的那些死傷家屬慰問。"我們從未在盧克索之前這類事情。這是一件可怕的事情,"他說。"為遊客和埃及人的安全我已下令處理氣球來停止飛行,直到我們知道到底發生了什麼和它的原因的所有公司"。事故發生在許多黎明熱氣球飛行,給遊客一個鳥瞰圖的盧克索的卡納克神廟和在帝王谷陵墓等著名網站之一。氣球的經營公司,天空巡航,說爆炸,船上的氣瓶在甘蔗田以西盧克索降下來。當她聽到爆炸聲,看見火焰從一個以上的氣球降落櫻桃哈密氣球"我們的飛行員告訴我們氣球已經觸及高壓電力電纜和船上的油缸爆炸,"說 Ms 哈密,埃及生活在科威特,他們是在度假在盧克索。"人們跳氣球從七層樓房的高度"。Alaa Mahmoud, a sales manager for another local balloon company, Magic Horizon, told the Guardian newspaper that the accident happened as crews tried to anchor the balloon to the ground using ropes hanging from the basket. The ropes became entangled in the tubes leading to the gas cylinder and severed them, after which the gas was ignited, he added."The flames were so strong that the pilot and one guy jumped," he said. "When they jumped, the balloon lost balance and the balloon went up again."An investigator with the state prosecutor's office also told the Associated Press that a landing cable had got caught around a helium tube.Another witness, US photographer Christopher Michel said his balloon was just about to land when he "heard an explosion and saw smoke".The area has been cordoned off by police and investigators are inspecting the charred remains of the balloon.Egypt's civil aviation minister has reportedly flown to Luxor to head the investigation into the crash.Hot air balloon crashes have happened in Luxor before. Two British women were among 16 injured when their balloon came down after hitting a communications tower in April 2009.Balloons were grounded for six months after that crash while safety measures were tightened up and pilots re-trained.But, says the BBC's Aleem Maqbool in Cairo, since the 2011 revolution that toppled President Hosni Mubarak, the rule of law is not being respected in many aspects of Egyptian life, so it has been difficult for the tourism ministry to impose its authority on sites like this.Luxor, like many other parts of Egypt, has seen a sharp downturn in visitor numbers during the two years since the uprising.
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