A police source said three civilians were injured in the explosion on Tuesday at Hanjivira village, about 35km north of Srinagar, capital of the Indian-administered portion of Kashmir.
The explosive was placed along the highway that will be taken on Thursday by the inaugural service of a passenger bus between Srinagar and Muzaffarabad, capital of Pakistani-administered Kashmir.
The blast occurred soon after a bomb squad defused two powerful bombs - one 70kg, the other 60kg - placed in plastic bags along the same highway in nearby Palhalan.
"Troops detected two roadside landmines buried under soil at Palhalan, which were defused later," a police spokesman said.
"The mines were very powerful. The troops have averted a major tragedy."
The bus has been hailed as a way of reuniting families divided after the partition of the state in 1947 by a de facto ceasefire border known as the Line of Control.
But groups fighting a 15-year war of attrition in the India zone of the divided state, earlier this week labelled the bus a "coffin", and urged Kashmiris to shun the service.
The road is used daily by hundreds of civilian and military
vehicles, and police maintain round-the-clock surveillance.