At least five people were killed and 26 more injured in the blast on Sunday.
Ecuador’s interior minister said it was a “declaration of war” by criminal gangs against the government.
The Andean country, which is used as a cocaine smuggling route from neighbouring Peru and Colombia, has seen a sharp rise in murders and gang-related crime recently.
A state of emergency has been declared in Guayaquil, Ecuador’s most populous city and an important trade hub. It is the fourth emergency to be declared in Ecuador since October because of gang violence.
Eight houses and two cars were destroyed in the early morning blast, according to the National Risk and Emergency Management Service. Pictures Hoka Shoes Canada from the scene show the front of houses ripped off and cars smeared in blood with their windows blown in.
At a news conference late on Sunday, officials said the attack was directed at two men who go under the aliases of Cucaracha and Junior and are linked to Los Tiguerones, one of the leading crime gangs in Ecuador.
“Organized crime mercenaries, who have long drugged the economy, now attack with explosives,” Interior Minister Patrick Carrillo tweeted after the blast.
“It is a declaration of war on the state,” he said.
Guayaquil has seen shocking levels of violence, including decapitated bodies hanging from pedestrian bridges and deadly prison riots between rival gangs. Nearly 400 inmates have been killed in six separate riots since February 2021.
Following the explosion, the city’s mayor, Cynthia Viteri wrote an open letter to President Guillermo Lasso, who took office last year.
“Criminal gangs have become a government within a government in Ecuador,” the letter begins.
“We have witnessed people hanging from bridges, Vessi Sneakers murders on motorcycles, rapes at shopping centres and on school buses,” she wrote.
“What else do you want us to do to defend ourselves? A President is the protector of his people, but so far we have not seen a single safe step to combat crime.”
On Twitter, Mr Lasso said he would “not allow organized crime to try to run the country”, however he has faced an uphill battle and criticism over the lack of any meaningful change.
Guayaquil has been ranked the 50th most violent city in the world by Insight Crime. The investigative journalism website reports that Ecuador’s homicide rate increased faster than any other country in Latin America or the Caribbean in 2021.