A Bahraini youth opposition group on Monday said it blew up a car in Manama overnight in an incident the authorities blamed on a "terrorist group" just days ahead of the country's Formula One Grand Prix.
There were no casualties in the blast and no damage other than to the car, police said in a statement.
"A terrorist group used a gas cylinder to burn a car in Manama at night on Sunday causing an explosion," the statement said.
The radical youth movement February 14 claimed responsibility in a statement on its Twitter account, saying the aim was to disrupt "activity in Manama's financial centre in opposition to holding the Formula One race" next Sunday.
Security services are investigating the attack aimed at "attracting the attention of the media" before the controversial race, official BNA news agency quoted a government official as saying.
Police and protesters chanting "No, no to F1" clashed in Shiite villages around Manama late on Monday, witnesses said. Roads were blocked by burning tyres and police fired tear gas and sound bombs at demonstrators.
The blast came as police also fired tear gas and sound bombs to disperse protesters in several Shiite villages. No casualties were reported.
The main Shiite opposition bloc Al-Wefaq condemned Sunday's attack "regardless of the party which carried it out."
It reaffirmed its "commitment to peaceful action as a strategic choice" and urged a "probe into the incident by an independent commission."
Sunni-ruled Bahrain has vowed to take "appropriate" security measures ahead of the April 19-21 Grand Prix, as Shiite demonstrators stage daily protests.
Signup to our newsletter and follow us on Facebook and Twitter!
Under the banner "Democracy is our right," the mainly Shiite opposition is holding a week of protests that began on Friday to coincide with the lead-up to the race.
Al-Wefaq said on Sunday that 98 people have been arrested and 31 injured in clashes with police so far this month.
According to Human Rights Watch, police have been rounding up pro-democracy activists in an attempt to head off protests over the Gulf state hosting the race.
Last year's event went ahead against a backdrop of police using tear gas, sound bombs and birdshot to disperse protesters throwing stones and petrol bombs.
Formula One supremo Bernie Ecclestone said in China he could see "no reason" why the Bahrain race should not be successful.
"Yes. There's no reason why it shouldn't be (a success)," Ecclestone told AFP at the Chinese Grand Prix in Shanghai.
Amnesty International, meanwhile, said in a statement that Bahraini authorities were amending the penal code to bring in jail terms of up to five years for anyone found guilty of insulting King Hamad.
"Increasing the punishment for criticism of Bahrain's king is a further attempt to muzzle activists ahead of the upcoming Grand Prix," said Hassiba Hadj Sahraoui, Amnesty's deputy Middle East and North Africa programme head.
Bahrain was rocked by month-long pro-democracy protests led by the kingdom's Shiite majority in early 2011 that were crushed with the help of Saudi-led troops. The race was cancelled that year but went ahead in 2012.
Protests have continued ever since in Shiite villages outside the capital. Human rights groups say a total of 80 people have been killed since February 2011.