A bomb has detonated near a migration office in Zirndorf near Nuremberg, according to German media reports.
A spokesperson for Middle Franconia Police said the explosion was reported shortly after 2.15pm local time (1.15pm BST).
German broadcaster Bayerischer Rundfunk reported that a suitcase filled with aerosols was detonated.
The explosion is thought to have been small and Bavarian broadcaster BR24 reported that there were no injuries.
Eyewitnesses described hearing a loud bang and spotted a burning suitcase.
“No evidence has yet been found that an explosive device was detonated inside the suitcase,” a spokesperson said.
“It is possible that aerosol cans stored in the suitcase caused the explosion in question.
“It appears that no one was in danger at any time. No injuries have yet been reported to the police.”
Officers were searching the area for two people seen with the suitcase shortly before the incident.
The area is in northern Bavaria, which has seen two attacks claimed by Isis in the past 10 days.
A Syrian blew himself up outside a wine bar, injuring 15 people.
The 27-year-old, who authorities have not identified, set off a backpack laden with explosives and shrapnel on Sunday night after being refused entry to the nearby festival in the Bavarian city of Ansbach because he did not have a ticket.
It was the fourth attack to shake Germany in a week – three of them carried out by recent migrants.
The Isis-linked Aamaq news agency said the man carried out the attack in response to calls by the group to target countries of the US-led coalition that is fighting IS.
The bombing was the latest of the recent attacks that have heightened concerns about how Germany can deal with the estimated one million migrants who entered the country last year.
Those fears waned as the numbers of new arrivals had slowed this year dramatically, but already the nationalist Alternative for Germany party and others have seized on the attacks as evidence that Chancellor Angela Merkel’s migration policies are flawed.
A 17-year-old Afghan asylum-seeker injured five with an axe before being killed by police near Wuerzburg last week in an attack that was claimed by Islamic State.
On Sunday, a Syrian man killed a woman with a knife in the south-west city of Reutlingen before being captured by police in an incident that authorities said was not likely to be linked to terrorism.
In between, the 18-year-old son of Iranian asylum seekers went on a rampage Friday night at a Munich mall, killing nine and wounding dozens. Authorities say he was undergoing psychological treatment and had no known links to terrorism.
The attack in Ansbach, a serene city of about 40,000 west of Nuremberg, came near the end of the closing night of a popular open air festival being attended by about 2,000 people.
Following the Munich mall shooting, city officials ordered extra security and bag checks at the entrance of the venue, but the man never got that far, being turned away for lack of a ticket, said Mayor Carda Seidel.
Roman Fertinger, the deputy police chief in Nuremberg, said there likely would have been more casualties if the man had not been turned away.