Witnesses said suspected Boko Haram fighters firebombed huts, and opened fire on civilians on Saturday evening in the village of Dalori, leaving bullet-ridden and charred bodies strewn across the streets. Gunmen also tried to storm a camp close to Dalori, home to some 25,000 refugees, but were repelled by troops.
Witnesses said they heard the screams of children burning to death as huts and homes were razed to the ground.
Mohammed Kanar, area coordinator of the National Emergency Management Agency, told the Associated Press news agency that 86 bodies had been collected by Sunday afternoon.
Another 62 people were being treated for burns, said Abba Musa of the State Specialist Hospital in Maiduguri, the biggest city in northeastern Nigeria, which is about 10km from from Dalori.
Nigerian troops were initially unable to fight off the attackers, and Boko Haram fighters only retreated after reinforcements arrived with heavier weapons, soldiers said.
"As they saw the flames of the fight, then they alerted us. I informed the soldiers ... and that's how they checked," Lawana Geti, head of a local vigilante group called Kondugua, said.
"And when the soldiers were coming, Boko Haram rushed out of the village."
The Lake Chad region - which borders Nigeria, Chad, Cameroon and Niger - has been frequently targeted by Boko Haram and all four countries have formed a coalition along with Benin to fight the group. The war between Boko Haram and the Nigerian government has killed 20,000 people in six years and driven 2.3 million people from their homes.
The UN children's agency says up to one million children have been forced out of school.
Source: Al Jazeera