A lone gunman killed Mark Kanapathipillai of the Eelam Democratic People's Party (EPDP), police said adding that the victim was a close associate of party leader Douglas Devananda.
The EPDP is part of Sri Lanka's ruling coalition and several of its members have been killed by suspected Tiger rebels despite a truce that has been in place since February 2002.
The latest attack came despite stepped up security arrangements in the capital as Tamil Tiger rebels marked "Black July," or the 23rd anniversary of anti-Tamil riots here.
Police and troops had set up more road blocks and tightened security at key installations amid fears that the rebel Liberation Tigers of Tamil Eelam (LTTE) could carry out attacks, a police official here said.
A Tiger landmine attack that killed 13 soldiers sparked anti-Tamil riots in this majority Sinhalese country in July 1983.
An estimated 400 to 600 Tamils were killed by Sinhalese mobs as the government at the time tacitly backed the rioters.