The bombing came on the same day as the opening of the Africa Games, one of the continent's biggest sporting events, which is taking place in Algiers and also in Blida and Boumerdes, two towns in Kabylie.
There was no claim of responsibility for the attack.
However, an al-Qaeda-aligned armed group previously known as the Salafist Group for Preaching and Combat (GSPC) has claimed responsibility for similar attacks in recent months, including a triple suicide bombing in Algiers that killed 33 people on April 11.
Abdelaziz Bouteflika, the Algerian president, asked the army in early July to step up attacks on armed groups, saying they were "enemies of the people".
Noureddine Yazid Zerhouni, the interior minister, told Algerian radio that the blast had caused a number of casualities.
He also said: "This attack will not prevent us from continuing our relentless fight against terrorism."
Anis Rahmani, a security expert, said the attack, which occurred three months to the day after the April 11 blasts, appeared to show that al-Qaeda was now firmly set on using suicide bombers in the Muslim country.
He said: "The suicide attack was expected, particularly after the security services succeeded in preventing any [suicide attacks] in the intervening 90 days."