It is unknown how many people were on board or whether they were injured in the crash.
Television footage showed a line of white body bags around the flaming wreckage, as emergency services rushed to the scene.
"There are more than 100 deaths. We can't say exactly how many at this point", Mohammed Achour, Chief Spokesperson for the civil protection agency, told media.
The remains of the victims are being taken to an army hospital for identification, the ministry added.
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At the time of the crash there were clear skies and low wind, KPHO said.
The plane had been transporting dozens of troops and equipment when it crashed, according to local reports.
Ennahar TV quoted an Algerian ruling party official as saying that 26 people onboard are members of the Polisario Front, a separatist movement in West Sahara - a territory also claimed by Morocco.
He said the plane was carrying soldiers.
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The Il-76 model has been in production since 1970s and has an overall good safety record.
The Algerian military operates several of the planes.
April 10-At least two people have died after a small plane crashed at a golf course in Arizona.
In February that year, an Algerian Air Force Lockheed C-130 Hercules crashed in a mountainous area in eastern Algeria killing 77 passengers and leaving one survivor.
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None of the six occupants on board survived the crash.