Wordorigins.org

This term has at least three distinct senses. The first use of blockbuster was during World War II, meaning a large aerial bomb. It was formed from the words for a city block and bust, a verb meaning to break. A blockbuster was a bomb large enough to destroy a city block. Time magazine printed this in its 29 September 1942 issue:

Inside a sturdy observation tower a mile from the exploding block busters which the Army is now testing.¹