Seventeen people were injured in an explosion on a bus near the defence ministry in Tel Aviv on Wednesday, Israel's emergency services said, in what an official said was a "terrorist attack."
The blast took place as US Secretary of State Hillary Clinton was in Israel for talks with Prime Minister Benjamin Netanyahu on ways to end a deadly spike in bloodshed in and around Gaza over the past week.
A spokesman for Israel's Magen David Adom emergency services said one person was in moderate to serious condition, three were in moderate condition and seven people lightly injured, while another six people were being treated for shock.
Police said the blast took place on Shaul HaMelech Street which runs just behind the Kiriya, Israel's sprawling defence ministry.
TV images showed the bus with its windows blown out and its metal frame contorted from the force of the blast, in images reminiscent of scenes from the 2000-2005 Palestinian uprising.
The front window was completely shattered and glass littered the floor as the wounded were loaded into ambulances by an army of medics.
Netanyahu's spokesman said it was "a terrorist attack."
"A bomb exploded on a bus in central Tel Aviv. This was a terrorist attack. Most of the injured suffered only mild injuries," said Ofir Gendelman on his official Twitter account.
The blast came as Clinton held talks in Jerusalem over a Gaza truce with Netanyahu, with a US embassy spokesman confirming the two had held their second round of talks in as many days.
In Gaza City, the mosque opposite the Shifa hospital broadcast praise for the attack.
"God is great, God is great. An operation in the heart of the Zionist entity," rang out from the mosque's loudspeakers. Celebratory gunfire could also be heard after the reports of the blast.
Israel has been locked in a deadly week-long confrontation with Palestinian militants in the Hamas-run Gaza strip, whose Al-Aqsa television channel on Wednesday welcomed news of the explosion.
"Hamas welcomes the martyrdom operation and affirms that it is a natural reply to to the massacre of the Dallu family and the targeting of Palestinian civilians," it said in a statement.
It was referring to nine members of a Gaza family who were killed in an Israeli air strike on Sunday.
An Israeli bus was last targeted in March 2011 when a bomb left at a Jerusalem stop ripped through a bus, killing a British woman and wounding over 30 other people.