The explosion was near the embassy’s main gate, where a Reuters journalist saw a scorched, damaged motorcycle and a damaged police vehicle as police gathered around and a helicopter hovered overhead.
The Interior Ministry said two militants died carrying out the attack and five police officers were injured and a civilian suffered minor injuries. State news agency TAP reported one policeman killed.
“We heard a powerful explosion. We saw the remains of the terrorist on the ground after he went toward police,” said Amira, a shopkeeper.
Sirens were heard on the highway linking the Lac district, where the embassy is, with Tunis and suburbs in the north. The US Embassy in a tweet urged people to avoid the area.
Roads around security installations were closed in parts of the capital and some international institutions were in lockdown or evacuated.
Photographs of the blast site on social media showed debris around the security checkpoint controlling embassy access and damaged vehicles.
Last summer, Islamic State said it was behind militant blasts in the capital over the course of a week, including one near the French Embassy that killed a policeman.
Tunisia’s tourism sector is vulnerable to militant incidents and was devastated after two attacks in 2015 which killed scores of visitors at a beach resort and a museum.
Diplomats working with Tunisia on its security capacity say it has grown more effective in preventing and responding to militant attacks in recent years.
An al Qaeda group sheltered for years in desolate, hilly terrain along a stretch of the border with Algeria and sometimes clashes with security forces but is regarded as being closely contained.
Hundreds of Tunisians travelled to Iraq, Syria or Libya in recent years to join Islamic State and in 2016 group members rampaged across the border with Libya and fought the army but were repulsed.
“The attack indicates the security challenge remains a major one in Tunisia,” local security analyst Ali Zarmedini said.