At least three people were killed and 32 wounded in an explosion which ripped through an open market in central Tel Aviv on Monday, Israeli rescue workers and police said.

The explosion, which was a suicide attack, according to police, occurred at 11:30 a.m. (0930 GMT) at a stall in the open Carmel Market in central Tel Aviv, causing large numbers of casualties, near the intersection of Rambam and Carmel Streets.

Israel Radio reported police believed the explosion may have been a terrorist attack.

"A suicide bomber exploded next to a vegetable stand inside the market," Tel-Aviv Police chief Cmdr. David Tzur said.

Local TV Channel 10 reported that police had found a body of a suspected male suicide bomber at the scene.

Police suspect that there may be other bombs or potential bombers in the area and are conducting searches.

Residents have been asked to stay away from the area. Large numbers of rescue personnel were reported on their way to the scene.

The security officials registered 44 terror alerts as of Monday morning. Two Palestinian would-be bombers were arrested in the past week in the West Bank, Army Radio reported.

A witness, who was identified only by his first name Motti, said he heard an explosion in the market.

"I thought maybe fireworks, or a gas canister. But then I saw a store completely destroyed. Goods fell to the ground. People ran away. I lost my glasses and my hat," Motti was quoted by the radio as saying.

Officials in Jerusalem said there was no connection between Monday's attack and Palestnian National Authority Chairman Yasser Arafat's health condition.

It was the first suicide attack in Israel since ailing Palestinian leader Yasser Arafat was flown to Paris from the West Bank city of Ramallah last Friday for medical treatment in France.