The emergency services say 49 people have been hurt or are suffering from shock.
Gardai have confirmed that a car collided with a 50-seater bus at the junction, but thankfully no-one has been killed or seriously injured.
A full medical response team has been assembled to deal with the incident.
Fire crews, ambulance crews and Gardai are attending the scene.
It’s understood the pensioners were on a coach day trip from the St Johnston and Carrigans areas to Donegal Town and Ardara for the day.
It was the Resource Centre’s annual day trip for pensioners in the area.
The crash happened at the Ardaghey Cross Roads at its intersection with the N56, a few miles from Inver.
Extra staff have been called in to Letterkenny general hospital to deal with the casualties of the incident, the worst coach crash in the county.
A Garda spokesman said: “A bus and car collided at Castleogary, and 49
elderly people taken to hospital in Letterkenny as a precaution.
“The drivers of both vehicles also taken to hospital but there are no serious injuries. Garda Forensic Collision investigators are at scene.”
Families of all those on the trip were informed soon after the incident.
Letterkenny General Hospital is extemely busy tonight.
The HSE is urging people not to go to the Emergency Department unless it is absolutely necessary.
The NoW DOC service should be the first port of call.
One man whose mother is in hospital told us: “It’s a miracle that no-one was more seriously hurt. I understand the car went into the side of the bus.
“My mother is ok; just very shaken by the experience.”