A car bomb ripped through the street outside the Danish embassy in Islamabad killing at least six people in what's presumed to be an act of revenge for cartoons of the Prophet Mohammed published in Danish newspapers.

It was the first bombing outside Pakistan's troubled northwest since the country's new government came into office at the end of March.

Officials had previously suggested that the controversial new policy of holding peace talks with Islamist militants based in the northwest tribal region had ended a vicious campaign of bombings that had rocked the previous regime.

"This has far-reaching consequences," said Javed Hashmi, a leader of the Pakistan Muslim League-N, Pakistan's second largest political party and an estranged member of the ruling coalition government. "Since this democratic government came in, bomb blasts had lessened. Today that challenge has stood up again."

The car bomb exploded to devastating effect in a side street that runs alongside the Danish mission, which is in an upscale residential area of Islamabad. A crater about two metres across and one metre deep was left in the street, the car completely blown away by the force of the blast. Its engine landed more than 10 metres away, smouldering in another street. Officials said it was unclear whether it was a suicide attack.

Two Pakistani embassy workers and a Danish citizen of Pakistani origin were among the dead, according to the Foreign Ministry in Copenhagen.

The Danish embassy was left scarred but not badly damaged, with the gate and part of the guard post blown away, windows shattered.

Musarwar Shah, a security guard at a nearby house, said that he was saved only by being on the other side of the house's perimeter wall at the time.

"It was so loud that it took away your mind," Mr. Shah said.

"The smoke was so thick, you couldn't see anything. When I came on to the street, I found a man lying there, dead."

There were fears that the Taliban-inspired groups blamed for the previous bombings had started a new drive against the government. But experts thought it more likely that either a Taliban splinter group was behind the attack, seeking to derail the peace process, or it was an international group with a different agenda.

"The severity of the blast, type of technology used was quite different [from previous bombings]," said Talat Masood, a retired general turned security analyst. "It looks as if they wanted an international impact, an agenda outside our national boundaries."

Mr. Masood said it could have been the work of al-Qaeda. The terror group's deputy leader, Ayman al-Zawahiri, recently called for attacks on Danish targets, placing the country's embassies under obvious threat. Danish Foreign Minister Per Stig Moeller pointed out that the presence of his country's troops in Afghanistan might also be a motive.

The intensity of the explosion and the use of the car set it apart from the bombings that hit Pakistan for much of last year, which were mainly perpetrated by terrorists wearing suicide jackets.

There was swift reaction from Washington, pointedly suggesting that a harder line against extremism is needed.

"It does serve as a reminder to the government of Pakistan and to all governments that terrorism is real, that it cannot be allowed to have safe haven, they must be dealt with and confronted," White House spokeswoman Dana Perino said.

Pakistan has insisted that it is talking to tribesmen, not terrorists, based on its northwest border with Afghanistan. Rehman Malik, the Interior Ministry chief, said the negotiations would continue.

"There is no question of any impact of this incident on the peace process, but of course it badly harmed our image in the world," Mr. Malik said.