Updated Military spokesman Udaya Nanayakkara said a hand grenade had exploded in the Wellawatte area.
A LBO correspondent at the scene said the blast had gone off near a bus stop at the Vihara Mawatha junction in Wellawatte close to Rajasinghe Mawatha off Galle Road.
It was close to the scene of an earlier explosion where a concealed bomb went off in the middle of Galle Road, the correspondent said.
Wellawatte has a high concentration of ethnic Tamils and has also been the scene of killings in a turf war between Tamil Tiger rebels and a breakaway faction.