The BBC's Mike Wooldridge reports from New Delhi

Rescue work is continuing at the scene near the town of Khanna in Punjab state.

Indra Ghosh, Director of Indian Rail Safety: The system has become overstretched

India's Doordarshan state television has reported that another 300 people are thought to have been injured.

The accident happened when a train, the Frontier Golden Temple Mail, from Delhi to Amritsar left the rails early on Thursday morning.

Minutes later an express train travelling in the opposite direction from Jammu to Calcutta crashed into the de-railed carriages.

A police officer at the scene said the collision left the engine and front carriages of the express "crumpled like balls of paper."

Most of the dead are thought to have been in these first four carriages.

India's Prime Minister, Atal Behari Vajpayee, has expressed his "profound grief and sadness" over the incident adding: "I extend my heartfelt condolence to the kith and kin of those who lost their lives."

The BBC's Asit Jolly describes the scene of the crash

The minister responsible for the Indian rail network, Nitish Kumar, visited the site on Thursday and has ordered a full investigation, although officials say there is no suspicion of foul play or sabotage.

Mechanical failure

"It was a purely mechanical problem," Mr Kumar said.

At this stage the accident is being blamed on a weakened coupling which allowed several carriages of the Amritsar-bound Golden Temple Mail to break free and then topple across the parallel track.

Many people from Khanna and other nearby towns joined the rescue effort, ferrying the injured to local hospitals and giving food and shelter to those less seriously wounded.

Police rigged up loudspeakers to reassure those trapped in the wreckage that help was coming, while residents shouted encouragement.

Lack of equipment

The death toll is still expected to rise

But rescuers have been hampered by the lack of heavy lifting gear and the fire risk from spilt diesel fuel preventing them from using gas cutting equipment.

The accident is the worst since 1995 when around 300 died and more than 400 were injured after two express trains collided near the city of Agra.

Most rail crashes have been blamed on human error or outdated signalling equipment.

Rail travel in India is low cost and very popular, but also notoriously over-crowded - there are thought to have been as many as 2,600 passengers on the two trains involved in Thursday's accident.

"Sixteen of the 37 coaches have been totally wrecked," railway official Ajay Shukla said.

"In such a high velocity collision, the casualties are expected to be very, very high."

Railway Minister Nitish Kumar said compensation of 25,000 rupees ($595) would be paid to families of the dead and 5,000 rupees ($119) for each of the injured.