The building hit by the blast was no longer occupied by the UN

"Two attackers were killed and two others were severely injured," Information Minister Ahmad al-Hassan told Asharq al-Awsat newspaper.

They seemed to be Islamic militants of "different nationalities", he said.

"In view of the terrorist acts and volatile situation in the region the fingers of accusation do not exclude al-Qaeda," he said.

Security forces exchanged fire with the men when they surprised them in what turned out to be an explosives-laden car near the Canadian embassy in Mazzeh area, Mr Hassan said.

Syria seems to be once again starting fires just to get credit for putting them out US Congressman Eliot Engel

The men got out of the car, blew it up and fled into an empty building that had been used by the United Nations, he said.

The four men then tried to escape in a second car but crashed into a wall after security forces opened fire.

A policeman and a female bystander were killed in the shootout, the information minister added.

He did not say what the target of the car bomb might have been.

High alert

Mr Hassan repeated Syrian government assertions that the attack was a symptom of the unrest afflicting the entire region, "with the US occupation of Iraq and the daily Israeli crimes against the Palestinians creating sick mentalities".

The bombers' intended target - and their identity - remain unclear

Syrian security forces have been on high alert since the attack.

Local media showed pictures of a weapons cache discovered after the clash.

BBC correspondent Kim Ghattas in Beirut says it is unclear why Syria may have become a target for Islamist militants now - although it is ruled by the secular Baath party and has a history of brutally crushing Muslim militancy.

Questions are also being raised about how it was possible for the group to actually operate and gather weapons unhindered, considering the tight security in Syria, she says.

US disbelief

In Washington, two US congressmen have alleged that the shoot-out was orchestrated by the Syrian government to ward off sanctions.

New York Democrat Eliot Engel and Florida Republican Ileana Ros-Lehtinen have sponsored a law authorising the Bush administration to restrict investment and limit diplomatic activity with Syria, which the US considers a state sponsor of terrorism.

"The attack was a charade, one more political manoeuvre by the regime to avoid US sanctions," Ms Ros-Lehtinen told reporters.

"The UN building was empty ... this was staged," Mr Engel said. "Syria seems to be once again starting fires just to get credit for putting them out."