"Twenty-three people were killed and 67 wounded," said military spokesman Brigadier Udaya Nanayakkara. "They are all civilians."

"The terrorists were desperate in that area and are now targeting civilians."

The blast in the town of Buttala in the central district of Moneragala was the latest in a series of roadside bomb attacks blamed on the rebels, who are fighting to create an independent state in the island's north and east.

The Liberation Tigers of Tamil Eelam (LTTE) were not immediately available for comment on the blast, which bore the hallmarks of previous rebel attacks, but routinely deny involvement.

A 2002 ceasefire which broke down on the ground two years ago formally ends later on Wednesday after President Mahinda Rajapaksa's government announced a fortnight ago it was scrapping the pact, triggering fears that the fighting will deepen.

The government argues the rebels simply used the peace pact, which Nordic monitors said the Tigers violated thousands of times, to buy time to regroup and rearm and that they were not sincere about talking peace.

The government, also accused of hundreds of truce violations, has vowed to wipe out the Tigers militarily. The rebels have vowed to fight a full-scale war if one is waged against them to evict them from their northern stronghold.

Around 70,000 people have been killed since the war erupted in 1983, and the toll climbs daily.

The scrapping of the truce has shocked the international community and is seen ruining any hope of resurrecting peace talks any time soon. And with the truce monitors forced to wrap up their mission and leave the island too, many fear human rights abuses will mushroom.