Eleven people have been killed in a bomb blast near a bus in city of Zahedan in south-eastern Iran, the official Irna news agency has reported.
The bomb, hidden in a car, targeted members of Iran's Revolutionary Guard, the agency said, although it is unclear if all the dead belonged to the guard.
Qassim Rezai, a military commander, described the act as "terrorism" and blamed "rebels".
Recent attacks have been blamed on the Sunni Jundallah (Allah's Brigade).
Correspondents say an attack of this size and nature is unprecedented in Iran - hitting an elite force in daylight in an open street.
Reports say suspects behind the bombing have been arrested.
The city of Zahedan lies in the province of Sistan-Baluchestan, which borders both Afghanistan and Pakistan.
It has been hit by a string of attacks and kidnappings blamed on the hardline Sunni group called Jundallah.
Iranian officials have accused Britain and the United States of supporting ethnic minority rebels operating in the Islamic republic's sensitive border areas.
Remote control
Zahedan has been the focus of low-level unrest, with several security force members being killed in the last two months.
Fars news agency says a small car overtook the bus and then stopped in front of it, the occupants saying it had broken down.
They were then picked up by motorcycles and taken away before the bomb planted in the car exploded, apparently triggered by remote control.
A precise casualty number has been difficult to establish. The Iranian Red Crescent said only eight complete bodies had been recovered.
"The bandits and the agents of insecurity in this criminal act put a bomb near the bus and martyred these people," Mr Rezai said.
Irna said five suspects were arrested, including two suspects apprehended by members of the public.
The city lies in the province of Sistan-Baluchestan, which borders both Afghanistan and Pakistan.
It has been hit by a string of attacks and kidnappings blamed on the hardline Sunni group called Jundallah.
Iranian officials have accused Britain and the United States of supporting ethnic minority rebels operating in the Islamic republic's sensitive border areas.
The Revolutionary Guard was formed in the wake of the 1979 Iranian revolution as a military force alongside the army that is closely tied to the country's Supreme Leader.
Iranian bombing 'kills 11 people'
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#1 Iranian bombing 'kills 11 people'
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#2
Potentially interesting development. It's a long-known fact that when you teach people how to conduct insurrections and partisan warfare, it's entirely possible they'll come back at you with that very knowledge and training. Stalin purged a bunch of his own over that very potential.
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"'Flammable' and 'inflammable' have the same meaning! This language is insane!"
GIVE ME COFFEE AND I WILL ALLOW YOU TO LIVE!- Frigid
"Ork 'as no automatic code o' survival. 'is partic'lar distinction from all udda livin' gits is tha necessity ta act inna face o' alternatives by means o' dakka."
I created the sound of madness, wrote the book on pain