Ten people were wounded when attackers hurled a grenade into a restaurant in a popular coastal tourist resort town in Kenya, police say.
Thursday's attack, one of a series of bomb or grenade blasts in Kenya, is the latest to target areas popular with foreign visitors who are key to the economy.
"We had an explosion at the bar and about 10 people were injured," said Jack Ekakuro, the local police chief in the Indian Ocean town of Diani, south of Mombasa.
Attackers targeted the Tandoori bar in Diani in the early hours of Thursday, when it was still crowded with people celebrating over the New Year holiday.
The holiday is one of the busiest times on Kenya's coast, a mainly Muslim region whose white beaches are popular with tourists but which is also troubled by extremist groups and religious tensions.
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"We're trying to establish the kind of explosive used," Ekakuro added, but a police officer at the scene, speaking on condition of anonymity, said the blast "had all the characteristics" of a grenade.
"The attackers were on a motorcycle and fled after hurling the grenade," a police source said.
There was no immediate claim of responsibility for the attack.
Since Kenyan troops invaded southern Somalia in October 2011 to help oust the neighbouring country's al-Qaeda-linked Shebab insurgents, it has been hit by a series of attacks.
Last month attackers hurled a grenade at British tourists as they drove from Diani to the main port city of Mombasa, but it failed to explode.
Homegrown groups including the Islamist Al-Hijra group, a radical organisation formerly known as the Muslim Youth Centre, operate on Kenya's coast and have been linked to the Shebab.
Grenades have been hurled into restaurants in Mombasa and crowded areas in the capital Nairobi, as well as a string of attacks in the remote northeast region bordering Somalia.
The Shebab claimed the brutal September assault on Nairobi's upmarket Westgate mall in which at least 67 people died in a four-day seige of the shopping centre popular with foreigners.
