The blaze engulfed the second floor of the building on Tuesday night, trapping customers and staff as dense smoke filled the staircase and blocked the emergency exit, reports said.
Many crowded onto a balcony to escape the flames, which grew quickly as they caught the wooden interior, while others were forced to jump from the building, state media added.
Photos showed plumes of smoke billowing out of the bar – located in a crowded residential neighbourhood in Thuan An city, north of commercial hub Ho Chi Minh City in Binh Duong province – as firefighters on cranes tried to extinguish the blaze.
“We are still searching for more victims but the death toll so far is 23, and 11 people injured,” Mai Hung Dung, a top official with the ruling Communist Party in Binh Duong, told AFP.
Authorities had previously put the death toll at 12.
“Many people ran outside through the main entrance, but many others could not stand the heat and they jumped down, breaking their hands and legs,” Sang said.
Rescue workers searched through the night for anyone trapped in the 30-room bar, according to state media.
Vietnamese Prime Minister Pham Minh Chinh on Wednesday ordered a further inspection of high-risk venues, especially karaoke bars.