A roadside bomb exploded near a crowded passenger bus in the Sri Lankan capital Colombo on Friday, killing 20 people and wounding 47, the military said.

The government blamed the Liberation Tigers of Tamil Eelam (LTTE) for Friday's blast as well as for a series of recent urban attacks that have increased since the military began putting pressure on rebel territory in the north and east.

The blast occurred during the morning rush hour in the southern suburb of Moratuwa and the military put the death toll at 20 after earlier saying 21 had died.

"The bomb was planted on the road side, hidden in a bush and then exploded using a remote control," said an official of the police bomb disposal unit, asking not to be named.

A Reuters witness said the bus was shredded by shrapnel and the floor was covered in blood and debris.

"I was on my way to office and suddenly I heard a loud explosion and saw people screaming with blood all over," said Aruna Wickramarachchi, a 45-year-old hotel worker.

"My leg was also injured from the explosion," Wickramarachchi said, adding that she was among about 100 passengers on the bus.

President Mahinda Rajapaksa called on people to remain calm and not be provoked by the latest violence.

"Remain vigilant against the forces of terror and continue to assist the Police and Security Forces in the task of eradicating terrorism from our country," he said in an statement.

The latest attack comes as Sri Lanka's military presses its offensive to retake the Tamil Tigers' northern stronghold in daily land, sea and air attacks in a civil war that has killed more than 70,000 people since 1983.

It comes two days after the military blamed the rebels for a bomb blast on a railway track that wounded 27 civilians in Colombo.

Rajapaksa said Friday's attack was further proof the LTTE was feeling the pressure of the military offensive.

"This brutality also shows the efforts of the LTTE to provoke a backlash against the Tamil people, from which it hopes to gain," he added.

The rebels, who are fighting for an independent state in the north and east of the island, were not immediately available for comment but usually deny involvement in such attacks.

Fighting between the military and the LTTE has intensified since the government formally pulled out of a six-year-old ceasefire pact in January, though a renewed civil war has been raging since 2006.

Analysts say the military has the upper hand in the latest phase of the long-running war given superior air power, strength of numbers and swathes of terrain captured in the island's east.

But they still see no clear winner on the horizon.