Earlier, Arturo Chavez, Mexico's attorney general, said there was no evidence of "narcoterrorism" in the attack which injured 16 people.

The introduction of car bombs marks an escalation in tactics by  suspected drug gangs. 

Retaliatory attack

"This is the first time that we have seen a car bomb used in this sort of effort to attack Mexican security officials," Franc Contreras, Al Jazeera's correspondent in Mexico City, said. 

"An explosive known as C4 was used. This explosive has been used in other parts of the world where terrorist attacks have taken place," our correspondent said.

The attack was retaliation for the arrest on Thursday of Jesus Armando Acosta Guerrero, allegedly a senior drug cartel boss, the security ministry said in a statement. 

Violence has spiralled since Calderon sent the army to fight drug gangs [Reuters]

Drug killings have spiralled across Mexico since Felipe Calderon, the president, launched his military-backed drug war after taking office in 2006.

Walter McCay, a police trainer, told Al Jazeera: "This whole war is occurring in Mexico ... because of the social fabric, the breakdown in opportunity for the entire country."

He said "ninety-nine per cent of the wealth is owned by five per cent of the people in Mexico; it just doesn't trickle down anywhere else".

Violence surge

Two rival drug gangs - the local Juarez cartel and the Sinaloa cartel led by Joaquin "Shorty" Guzman - have been fighting an all-out war in Ciudad Juarez for control of the drug trade that has killed nearly 6,000 people there in the past three-and-a-half years.

Gangs have decapitated people and gunned down rivals in daylight attacks.

"What you're seeing now is a whole new level of violence. It's a vehicle-borne improvised explosive device," said a source following the investigation closely but who declined to be named for security reasons.

"This has raised the bar to a level of violence that Mexico has not seen yet. It is reminiscent of Colombia ... What we're seeing now is what the military is running into in Iraq and Afghanistan."

Graffiti scrawled on a wall near the blast warned that "what occurred ... would continue to happen to authorities that carry on supporting Shorty". 

Elsewhere in Mexico, 12 other people were killed in running gun battles between soldiers and suspected drug-cartel gunmen in the border city of Nuevo Laredo in the country's north, officials said.

The federal interior department said in a statement that the dead include nine suspects, two civilians and one soldier.

Twenty-one people - including three children caught in the crossfire - were wounded in the gunfights on Friday.