At least five persons were injured on Friday in a powerful explosion triggered by the ULFA near the Guwahati central jail in the busy Fancy Bazaar area of the city.
The police said that the bomb, hidden underneath a rickshaw, went off when a large number of people were buying essentials in the vegetable market.
Panic spread through the busy commercial hub as businessmen downed shutters and people ran for safety.
The Fancy Bazaar area is dominated by Hindi-speaking businessmen who have become a target of the banned outfit.
The police has cordoned off the area and started an investigation.