A young boy cries after being rescued by police. Police found the students chained together in the basement of the schoool.
The group was discovered in an underground room with heavy chains linking them together.
The school, Al-Arabiya Aloom Jamia Masjid Zikirya, which also was a drug rehab clinic, is in Sohrab Goth, a suburb of Gadap in Karachi.
All 14 boys were returned to their families, senior police official Ahsanullah Marwat told CNN.
Of the adults, 47 had been released to their families, and seven were handed over to a shelter for the homeless, he said.
Students in chains at religious school
Three people who worked at the facility were arrested, but the four men who ran the place were still at large, Marwat said.
Officials said the facility was part madrassa and part drug-rehab facility, and the captives were chained at night apparently to prevent their escape.
"The operation was successful, and we plan on continuing our work to ensure that places like this are shut down," Marwat said.
Many of the captives told police their families sent them there because they were recovering drug addicts. During the day, they worked and did religious studies.
But the future of the rescued children was unclear.
One woman told a local television station that she was willing to pay the police to keep her troublesome child. She said she would rather have the facility remain open, regardless of how it treated the children.
Many others, however, said they were in shock and disbelief over the allegations.
One man complained he was deep in debt after paying the school a large amount of money to board his son.
By Shaan Khan, CNN