The explosion happened at about 1 a.m. Thursday in Adair County, the (Louisville) Courier-Journal, reported.
Two homes were destroyed and two people were injured, Adair County Emergency Management Director Greg Thomas said.
"There is now a crater 60 feet deep and it blew rocks out, and I don't mean pebbles, ... big rocks," Thomas added.
The injured were brought to a local hospital, where one was treated for burns, Thomas said. The other injured person was brought to the hospital for evaluation.
About 20 homes within a few miles of the blast were evacuated, Thomas said.
The gas line is operated by Columbia Gulf Transmission and is used to transport natural gas from the Gulf of Mexico to New York.
Fires caused by the blast have been brought under control and will likely burn off on their own, Kentucky State Police trooper Billy Gregory said.
"Basically at this point everything is contained and they're working to get the rest of the fire out," Gregory said.
The explosion was felt by many people in the area, WLKY-TV, Louisville, reported.
"It happened two miles past Taylor County line in Adair County on Highway 76. Looks like the whole sky was orange and it sounded like a million jets over my house, the ground was shaking. We don't have power and I live about three miles from explosion," said witness Brooke Cox Humphrees.
"I had just got done watching the Olympics and was getting into bed when the whole house shook and it sounded like a big bomb went off. It lit up the sky like it was daylight, it was a great ball of fire. I live 0.25 miles from the explosion. My friend in Campbellsville, which is about 13 miles away, felt it. I could feel the heat outside my home and debris was falling, rocks and dirt. I was in the Army 20 years and I've never experienced an explosion like that," resident Bill Kingdollar said.