JERUSALEM - A pipe bomb believed to have been planted by Palestinian extremists exploded Sunday on a bus in central Israel just moments after it had been evacuated, police said, in the most serious attack inside Israel in more than a year.

The explosion came at a sensitive time in Mideast peace efforts. Israel and the Palestinians resumed talks last summer for the first time in nearly five years, and the U.S.-brokered negotiations have made little visible progress. The explosion threatened to further poison what has become a tense and negative atmosphere.

Police spokesman Micky Rosenfeld said there were no injuries in the blast, in the Tel Aviv suburb of Bat Yam. The explosion blew windows out of the bus and charred the sides of the vehicle.

"Based on the findings at the scene by bomb-disposal experts, it was a terrorist attack," Rosenfeld said. "We're continuing to search the area for suspects."

Rosenfeld said the nature of the target and the device led authorities to determine that extremists, not criminals, were behind the bombing. He declined to elaborate, and there was no immediate claim of responsibility.

He said the bomb was discovered in a bag on the bus. The driver quickly ordered passengers to leave the vehicle, and the bomb exploded shortly after as a bomb-squad expert was inspecting it. The police sapper was not injured but was taken to a hospital to be evaluated.

President Shimon Peres later phoned and thanked the bus driver and the passenger who discovered the explosive, saying their actions saved lives.

"The nation owes you a debt of gratitude, and I would like to personally congratulate you for this act of bravery," Peres told bus driver Michael Yoger.

U.S. State Department spokeswoman Jen Psaki issued a statement condemning the bombing.

It was the most serious attack inside Israel since a bomb explosion wounded more than 20 people in Tel Aviv in November 2012. At the time, Israel was involved in heavy fighting with Palestinian extremists in the Gaza Strip.

A decade ago, Israel experienced a rash of Palestinian suicide bombings on buses, in restaurants, and in other public spaces. More than 3,000 Palestinians and 1,000 Israelis died in several years of fighting.

Tensions have subsided in recent years. The neighboring West Bank has seen a recent uptick in Israeli-Palestinian violence, though senior Israeli officials believe the various incidents there have not been connected to one another.