Local media report that a second unexploded device was found near the location of the first attack, but was deactivated by the police.
It is the first terrorist attack inside Cairo since April 2005, when a string of attacks rocked the bazaar and crowded downtown area in a number of days, killing two French citizens and an American. The Monitor covered those attacks at the time (in this story).
Egypt's economy is heavily dependent on tourism, with millions of foreign visitors arriving each year to visit sites like the pyramids and the country's many Red Sea beach resorts. Sunday's bombing immediately raised fears that the country's tourism income could be threatened.
Hours after the attack, there were several conflicting reports over how many people had been killed and injured. It was also not clear exactly what happened in the attack.
Hany Abdellatif, a spokesman for the Interior Ministry, told CNN that no one was killed, but an anonymous security source told the network there were four dead.
Both stations identify the deceased as a French woman, although no details about her have been released. Egyptians, French, Germans, and Saudis are also reportedly among the injured.
The official MENA news agency says the bombs were thrown from the roof of a nearby hotel, but Nile News, also state-run, says they were placed under the chairs of a cafe popular with tourists. According to the Associated Press, the attacker threw a grenade.
The blast occurred around 6 p.m. amid a line of open-air coffee shops and restaurants popular with tourists, in a busy square in front of one of the city's largest mosques.
By 10 p.m., security forces blocked several streets to the area and Habib Al Adly, the Interior Minister visited the site.
Egypt waged a long struggle against Islamist terror groups throughout the 1990s, with several attacks seriously damaging its tourism industry, such as the 1997 massacre of 50 tourists at the temples of Luxor.
Bombings continued in recent years at beach resorts in the Sinai, with 60 killed in a 2005 attack, although attacks in the capital and the Nile Valley have been rare. Following an April 2006 string of bombings in the Red Sea resort of Dahab, Egyptian authorities were concerned that domestic terror groups had "reestablished themselves after years of relative peace" at a time when terror attacks were rising globally, as the Monitor reported here.
The September kidnapping of 19 tourists on a desert safari near the Sudanese border caused concern that tourism could fall. Sunday's attack brought those fears to the fore once more.
No group has yet claimed responsibility for the attack, but some representatives of Egypt's government were quick to point fingers.
"I was praying and there was a big boom and people started panicking and rushing out of the mosque, then police came and sealed the main door, evacuating us out of the back," Mohammed Abdel Azim told AP. He was among a crowd of worshipers inside the mosque during the attack.
"Dear God, this is a terrible thing, most of our income comes from tourism, we have 2 or 3 million who come a year," said a shopkeeper identified only as Ahmed on Al Arabeya. "This is not Egypt – Egyptians are safe peaceful people who love everyone."