The bus, belonging to Phuket based company Je-Siam, was carrying 37 Russian tourists and two guides when it careered across the traffic and plunged off the right side of the road on the final bend before Wat Suwankiriwong before smashing into a construction site below.
The passengers had just arrived in Phuket and were on their way from the airport to their hotel, the Duangjit in Patong.
Pol Col Arayapan Pukbuakhao, Superintendent of Patong Police, said the driver had told him that although he had stamped on the brake pedal as hard as could, he was unable to slow the bus because the brakes were not working properly.
The driver of the bus was taken to Kathu police station for questioning.
The crash is the third in a week involving tourists travelling in buses. On Saturday (October 22) a Chinese woman died after a bus crashed near Chalong and on Monday (October 24) a Korean tourist was badly injured when a minibus smashed into a tree in the north of the island.