The train operator said the bus driver had been attempting to pass in front of the moving train.
Canadian Pacific Kansas City de Mexico, the railway, expressed its condolences to the victims' families and called on drivers to respect road signs and stop orders at railroad crossings.
Bus operator Herradura de Plata did not immediately respond to a request for comment.
Images from the scene showed the front part of the top deck of the bus smashed in and its metal frame badly dented, as first responders cordoned off the area.
The collision happened in an industrial zone on the highway between Atlacomulco, a town some 115 kilometres northwest of the capital Mexico City, and Maravatio, in nearby Michoacan state, local authorities said.
The State of Mexico's attorney general's office said seven women and three men were killed. Some of those injured were in severe condition, while others were quickly released from the hospital, it added, without giving numbers.
Deadly bus crashes are frequent in Latin America. The Mexican government's latest report of collisions on federal highways showed a total of 12,099 crashes in 2023, resulting in more than $US100 million ($A152 million) in damage, 6400 injuries, and nearly 1900 deaths.Â
In February, more than 40 people were killed in southern Mexico when a bus travelling to Tabasco from the tourist city of Cancun hit a trailer truck and caught fire.
Buses are a major mode of transport in Mexico, where, although freight trains are common, passenger rail routes remain limited.
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