Two small makeshift grenades exploded outside the building causing windows to shatter but caused no injuries, a spokesman said on Thursday.
Aljazeera's correspondent in New York Abd al-Rahim Fuqara reported the blast caused light damage to the 21-storey building.
"There was a blast at the British consulate," a New York Police Department spokesman said.
The incident occurred at about 4am (0800 GMT) as British voters went to the polls in a general election.
A second police spokesman said later that there was minimal damage to the building, with only a door, window and a nearby car damaged.
Authorities said they had no clear indication the consulate, which shares the building with several other tenants, was a target.
Police were reviewing images shot by 17 security cameras at the building and other locations to try to identify possible suspects.
Bomb squad specialists and police
blocked off the scene of the crime
One of the videos raised suspicions that one of the devices may have been thrown from across the street, police Commissioner Raymond Kelly said.
Kelly made an appeal for eyewitnesses to come forward, saying a female jogger, a bicyclist and a taxi were shown on tape around the time of the explosions.
"This is New York," he said. "It's 3.30 in the morning, yet there were people out on the street."
The devices used in the attack were described as replica grenades, normally sold as novelty items that were stuffed with gunpowder and lit with a fuse.
"We don't know who the particular target was at this time," Mayor Michael Bloomberg said. "There were no threats or phone calls."
The blasts occurred in one of a row of circular concrete planters - placed along the sidewalk to deter car bombers - at Third Avenue and 51st Street, within blocks of police and fire stations and less than a mile from UN headquarters.
"It sounded like thunder - two loud bangs," one witness told WINS radio.
Security was tightened at the United Nations and officials shut down several blocks surrounding the glass-and-metal office building, which also has stores, a bank and the New York offices of the Japanese newspaper Asahi Shimbun.
In Chicago, police closed a portion of Michigan Avenue near the British Consulate for about 30 minutes to search the area as a precaution.
Bloomberg (R) says no threats
were made before the attack
At the building in Manhattan, workers were allowed in through a rear entrance about six hours after the explosion.
The incident, which briefly upset British financial markets, occurred as polls in Britain were opening for the general election, but police said it was not known whether the blast was connected to the consulate.
British voters have been warned that Britain and its interests could be targeted during the election campaign.
The British Consulate in Istanbul was attacked in November 2003. That attack, and another against a British bank in the same city at the same time, killed the British consul and 31 others.