The tensions flared as police launched investigations into the blast which ripped through a Shia mosque in the city during Friday prayers.

Members of the Shia Imamia Students Organisation staged violent protests and burned tyres at various locations after police blocked entry points to the city and soldiers stepped up their patrols.

"We will continue our protest until the culprits behind the attack are arrested," the organisation's president, Nasir Shirazi, told AFP.

Witnesses said vehicles were set alight and crowds attacked government buildings after thousands of people carrying black flags attended funeral prayers for nine of those killed in the mosque blast.

An angry crowd of about 2,000 people carrying rifles, iron rods and batons ransacked the offices of Pakistan International Airlines, a state-owned National Bank branch, district courts and the district jail, the witnesses said.

The crowd torched the office of Sialkot's mayor and besieged a police station, with officers from a commando unit responding with gunfire and teargas to disperse them.

Hundreds of youths burned tyres and blocked traffic on a busy road in Muzaffarabad, the capital of Pakistani Kashmir, some 240km northwest of here to protest the killing of a politician in the Sialkot blast.

Former speaker of Pakistani Kashmir's legislative assembly Syed Shaukat Hussain Naqvi, of former premier Benazir Bhutto's Pakistan Peoples Party, was killed in the explosion as he had gone there to meet his family.

Security officials said earlier the mosque blast, which also left dozens of people injured, was the work of a suicide bomber.

"We believe the bomber carried the explosive into the mosque in a briefcase which he detonated while sitting amongst the worshippers and also blew himself up," a security official, who did not wish to be identified, told AFP.

"It is an act of terrorism...," police chief Nisar Ahmed told AFP. "We believe a suicide bomber carried out the dastardly attack at a time when hundreds of worshippers were present inside the mosque for Friday's prayers."

The attack came five days after Pakistani security forces killed the country's most wanted Sunni Muslim extremist, al-Qaeda operative Amjad Farooqi, in a shootout in the south of the country.

Farooqi, the alleged mastermind of several attempts to kill Musharraf, was an activist in the Harkatul Jihad-e-Islam, a Sunni Muslim militant group blamed for the 2002 murder of US reporter Daniel Pearl.

Police said the attack could be retaliation for the killing of Farooqi.

Fanatics from Pakistan's Sunni Muslim majority and Shia minority, most of whom co-habit peacefully, have been killing each other since the 1980s. The conflict has so far cost more than 4,000 lives.

The hardline and banned Lashkar-e-Jhangvi group was blamed for two bomb attacks on Shia mosques in the southern port of Karachi in May and June which left 45 people dead.

The latest bombing also comes as Pakistani security forces are locked in a fierce battle against al-Qaeda, which has seen a number of important arrests since July.

The most notable were Pakistani computer specialist Naeem Noor Khan and Tanzanian Ahmad Khalfan Ghailani, who has been indicted by a US court for his role in the twin bombings of American embassies in East Africa in 1998.