Seven civilians were injured in a powerful grenade explosion in the main market at Magam, on the Srinagar-Gulmarg road, on Wednesday afternoon.
The injured have been taken to hospital, and security forces have cordoned off the marketplace for searches.
No outfit has taken responsibility for the attack.
Alarmed by the series of grenade explosions, the police have announced a cash reward of Rs 1 lakh and a government job to any 'vigilant and brave person who caught a terrorist throwing a grenade'.
On Tuesday, a powerful grenade blast injured 9 people in the nearby Narbal market situated on the same road used by tourists.