Police disovered a suspect suitcase one hour before the bomb exploded, with the words "Beware Bomb" written on it, a police spokesman said.

Attack warning

There was no immediate claim of responsibility but DYA, Spain's road assistance service, received a call warning that a bomb would explode 30 minutes later, police said.

Eta fighters traditionally call the DYA to warn of attacks.

Javier Balza, Basque interior department chief said: "We had to evacuate old people, children, people who were in their houses sleeping at this time.

"The houses are badly damaged. In the end, it's the people who suffer the madness of the terrorists."

Eta has killed more than 820 people since the late 1960s in its campaign for an independent Basque country in northern Spain and southwestern France.