The blast happened during the morning rush hour
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One person has been killed and 21 wounded - five critically - by a bomb in the Israeli city of Tel Aviv.
Police said the device, containing metal bolts, exploded near a bus stop.
The militant Palestinian group al-Aqsa Martyrs Brigades has reportedly said it carried out the attack, the first of its kind in Israel for four months.
Israel's Prime Minister, Ariel Sharon, has linked the attack with the World Court ruling on Friday that Israel should dismantle its West Bank barrier.
Speaking shortly after the blast, Mr Sharon told a Cabinet meeting that the perpetrators of the attack had been encouraged by the court's decision.
"The murderous act that was carried out this morning was the first to occur under the patronage of the World Court's decision." he said.
"I want to make clear, the State of Israel absolutely rejects the ruling [of the court]. It is a one-sided and politically motivated ruling."
The BBC's Paul Wood in Jerusalem says Israeli government officials are saying the latest attack underlines the need for the country to continue with the barrier's construction.
Hysteria
The explosion happened on Har Zion street near the old central bus station at about 0700 local time (0400GMT), as the morning rush hour was under way.
Eyewitnesses said there was pandemonium when the bomb went off.
"I was driving to work when I heard the boom," Shlomi Ben Amo told Israel radio.
"A female soldier flew in the air. There was hysteria and everything flew into the air."
Hospital officials said one woman was killed. Israeli media named her as 19-year-old Maayan Nayim, from Bat Yam, near Tel Aviv.
The windows of a bus and nearby buildings were blown out by the force of the blast.
Tel Aviv police chief Yossi Sedbon said it was caused by a device left in bushes and was not a suicide bombing.
The scene of the explosion was sealed off as police and firefighters with sniffer dogs searched the area.
'Act of revenge'
The al-Aqsa Martyrs Brigades, linked to Palestinian leader Yasser Arafat's Fatah faction, said it carried out the attack to avenge "assassinations" of its leaders and the killings of other Palestinians by Israel, Reuters news agency reported.
"This says that we can reach every place, even when there is a fence," an al-Aqsa spokesman was quoted by Associated Press as saying.
Sunday's bombing is the first such attack in Israel since 14 March, when 10 Israelis were killed in a double suicide bombing in the southern port of Ashdod.