The device was in a package sent to the office of the Liberal Islam Network (JIL), a grouping of religious intellectuals, in East Jakarta, national police spokesman Boy Rafli Amar told reporters.
"We suspected that it was a bomb. Our officers were trying to tame it when it went off," he said, adding that the police are investigating the motive.
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A witness told local television station MetroTV that the package was addressed to the group's former director and liberal Muslim scholar Ulil Abshar Abdalla.
"Our office received a suspicious package containing cables with a strong smell. We called the police," Fia Anwar said.
"As the police were checking the package, it exploded. Four people were injured, including a policeman and our security guards," she added.
"I saw clearly that a policeman's hand was cut off and our security guards had shrapnel wounds," she said.
Jakarta police spokesman Baharudin Djafar confirmed that the policeman's hand was "crushed" in the incident that took place at 4:05 pm (0905 GMT).
Local TV footage showed police officers flipping through the pages of a hollowed-out thick book, where the suspected bomb was hidden, and then a series of explosions were heard.
Around 50 police officers have sealed off the complex, where the office was located, an AFP photographer on site said, adding that the building was not damaged.
Abdalla, who graduated from a US university, is a well-known liberal Muslim figure who espouses pluralism and religious tolerance.
He regularly speaks out against Islamic hardliners through the microblogging website Twitter, where he has 50,000 followers.
Abdalla had joined Indonesian President Susilo Bambang Yudhoyono's Democratic Party last year and told MetroTV that the incident was "politically motivated", without elaborating.
Religion has been under the spotlight in recent months in Indonesia, the world's most populous Muslim country, and recently some provincial administrations issued a local decree which banned members of the Islamic Ahmadiyah sect from showing signs identifying their mosques and schools.
The country of 240 million people has been rocked by a series of bombings in recent years staged by Jemaah Islamiyah (JI), including the 2002 Bali bombings which killed 202 people.
