Officials said Harbin Y-12 twin-engine turboprop went down about 10.00am (1700 AEST) and burst into flames near Marsabit National Park, about 430km north-east of Nairobi.
Marsabit district commissioner Mutea Iringo said the plane crashed as it approached the airstrip outside town and smashed into a hill before catching fire.
"They lost direction of the airstrip because of foggy weather and then crash landed on a hill about 3km from Marsabit town," he told AFP.
"After it crashed, it burst into flames and the fire was so fierce that some of the bodies were burnt beyond recognition," Iringo said.
Six members of parliament were believed to have been killed in the crash, the worst-ever single disaster to befall the legislature, said National Assembly speaker Francis ole Kaparo.
"It appears that we have lost about six members of parliament," he told reporters. "It has never happened before."
There were conflicting accounts of the death toll, with some officials maintaining that 14 people had died instantly and others insisting that 13 were killed in the crash and another later succumbed to his injuries.
Of four badly wounded survivors known to have been plucked from the wreckage and flown to Nairobi for emergency medical treatment, one died en route to the capital, leaving open the possibility the toll could be as high as 15.
Officials and journalists who met the plane carrying the survivors at Nairobi's Wilson Airport saw three injured men and one corpse taken to hospital by ambulance.
The discrepancies appeared to be the result of confusion over how many people had been on the ill-fated plane as the manifest showed 17 passengers and crew but officials said they had accounted for 18 people.
"Fourteen people have died and four have been rescued," army spokesman Bogita Ongeri told AFP. "We are trying to establish information about this extra person and clear the confusion."
Those on board the plane were headed to Marsabit for meetings to defuse tribal tensions over water and pasture that have led to deadly clashes in the past and have been exacerbated in recent months by a searing drought.
Kenyan President Mwai Kibaki expressed "shock and disbelief" on learning of the accident.
Kibaki "received the news with shock and disbelief especially bearing in mind that the officials were on a mission to broker peace in northern Kenya," his office said in a statement.
"It was a very bad crash," said Farid AbdulKadir, the head of disaster operations for the Kenyan Red Cross, whose recovery efforts at the crash site were being augmented by the military.
"We are trying to get body bags there," he told AFP. "My workers on the ground are trying to pull out bodies from the wreckage."
Among the dead were Mirugi Kariuki, the assistant minister for provincial administration, opposition politician and former foreign minister Bonaya Godana, and four other members of parliament, officials said.
The three known survivors were the provincial commissioner for Northeastern Kenya and two soldiers, at least one of whom was either the pilot or co-pilot of the plane, they said.
The incident was Kenya's worst air disaster since July 2003 when a civilian light plane slammed into Mount Kenya, killing 12 US tourists, all members of one extended family, and two South African crew, in heavy fog and mist.
In 1996, a military plane crashed in Kenya's Eastern Province, killing 12 government officials who were heading to a peace meeting.