Swedish police investigating two blasts that rocked central Stockholm on Saturday night, killing one person and wounding two, said on Sunday they had good leads into what they said were "terror crimes".

Before the explosions, the Swedish news agency TT received a threatening letter about Sweden's military presence in Afghanistan and caricatures of the Prophet Mohammad drawn several years ago by a Swedish cartoonist.

A senior Swedish security police official told a news conference on Sunday the blasts were being treated as "terror crimes" and police had established good leads.

Anders Thornberg, director of operations at the Security Police, said police could neither confirm that the man who died was a suicide bomber nor discuss his identity, as some family members had not yet been informed.

"We are investigating this as terror crimes according to Swedish law ... we have not raised the security (threat) level," Thornberg said, adding that the police were stepping up their presence in the capital.

The drama began when a car burst into flames near a busy shopping street in the city center, followed by explosions inside the car which police said were caused by gas canisters.

The second explosion, about 300 meters (yards) away and 10 to 15 minutes later, killed one man and wounded two people.

"Most worrying attempt at terrorist attack in crowded part of central
Stockholm. Failed - but could have been truly catastrophic," Foreign Minister Carl Bildt said in a message on Twitter, which was also shown on his blog.

Police vans cordoned off several streets around the body and towed away the car. The rest of the city centre was calm, with people having a normal Saturday night out.

Several hours after the blast, the man's body was still lying on the pavement, covered with a white sheet.

Swedish newspapers all said the dead man had blown himself up. Dagens Nyheter quoted a man called Pascal, a trained medic, as saying "It looked as if the man had been carrying something that exploded in his stomach".

"He had no injuries to the face or body in general and the shops around were not damaged."

The Aftonbladet quoted a source as saying the man was carrying six pipebombs, of which only one exploded, and a rucksack full of nails and suspected explosive material.

The paper quoted eyewitnesses as saying the man was shouting in what was apparently Arabic.

TT said the email it received was also sent to the Security Police and had sound files in Swedish and Arabic.

"Our actions will speak for themselves, as long as you do not end your war against Islam and humiliation of the Prophet and your stupid support for the pig Vilks," TT quoted a man as saying in one recording.

TT said the threat was linked to Sweden's contribution to the U.S.-led NATO force in Afghanistan, where it has 500 soldiers, mainly in the north.

It also referred to caricatures of the Prophet Mohammad by the Swedish artist Lars Vilks, who depicted the Prophet with the body of a dog in a cartoon in 2007.

Most Muslims consider any depiction of the founder of Islam offensive.

In March, an American who called herself "JihadJane" was charged with plotting to kill Vilks. In May, arsonists tried to set fire to his house.
Vilks, contacted by Reuters Television, said he was safe.

"This is the first casualty of my project," he said. "It was an act against the Swedish people to scare them and not me. The good news was that a terrorist died and not someone else."

Evan Kohlmann, a U.S. terrorism consultant, told Reuters that a small militant Islamic community had been based in Sweden for some time. But he thought the incident on Saturday, if an attack, was one man's work.

"... given the scale of this attack and the target, I suspect this is a homegrown local extremist who may or may not have connections to any actual terrorist organization."

"We've seen a flurry of attempted attacks across northern Europe by similar lone wolf militants who were, in one way or another, enraged by the cartoon controversy."

Police spokesman Kjell Lindgren said it was not clear what had started the fire that made gas canisters in the car explode.

In January, a Somali man was indicted for terrorism and attempted murder for breaking into the home of the Danish cartoonist Kurt Westergaard and threatening him with an axe.

A cartoon by Westergaard in 2005 that depicted the Prophet Mohammad wearing a turban shaped like a bomb caused outrage across the Muslim world, leading to riots in the Middle East, Africa and Asia in which at least 50 people were killed.