A bomber set off a homemade explosive near a police station, sending shrapnel ripping through the air, and was wrestled to the ground before he could trigger a second one.
The explosion happened at around 9.35am today, according to a live blog ran by news portal Wenzhou News. No injuries were reported as yet.
The explosive had been filled with ball bearings, screw bolts and gunpowder from firecrackers, initial accounts said. Lighters were also seen strewn on the pavement, according to photos circulating online.
The middle-aged bomber was taken down by police as he was trying to detonate the second bomb. The police deputy chief fired one gunshot, but it was unclear if it was a warning shot or if it was pointed at the suspect.
Pictures showed him, in a black shirt and white sneakers, being pinned to the ground and handcuffed as a person searched his pockets.
The suspect was dragged away with his trousers down to his knees.
The bomb squad later successfully defused the second bomb, which was also filled with sharp metal objects.
Eyewitnesses said the suspect spoke in the Wenzhou dialect and said the bombing was likely linked to a debt dispute, according to the live blog.
Police have launched an investigation.