"There was no casualties in the bomb blast at a power transformer," a senior police official said adding no other incidents of violence were reported.

"We are taking all measures for the smooth running of the Independence day celebrations," she said.

Sri Lanka is on high alert after a string of bomb attacks by suspected Liberation Tigers of Tamil Eelam rebels including the suicide bombing at a railway stations in the heart of Colombo on Sunday that left 12 dead and 100 injured.

The official said as a precautionary measure, the mobile SMS services have been suspended till the celebrations were over.

Many roads throughout the capital were sealed and barricades erected near vital installations.

President Mahinda Rajapakse kicked off independence celebrations by unfurling the national flag at a sea-front promenade. Troops and brass bands marched accompanied by multi-barrel rocket launchers, armoured personnel carrier and Navy fast attack boats. It was followed by a fly past by helicopters and jets.

Military spokesman Brigadier Udaya Nanayakkara said the armed forces were expecting the rebels to disrupt the celebration.

On Saturday, a parcel bomb planted by suspected LTTE rebels ripped through a bus packed with Buddhist pilgrims killing 18 passengers, mostly women, and injuring 51 others in a central Sri Lankan town of Dambulla.