Security men inspect the site of a bomb explosion at Singjamei Chingamakhong in Imphal West district on Thursday.
A powerful explosion killed two people and wounded another six at a crowded market in Imphal, police said.
Police suspected a local militant group behind the blast that shook the heart of Manipur's capital.
"Two persons were killed and six injured in the blast and we suspect it to be an improvised explosive device," Clay Khongsai, senior Manipur police official, told AFP by telephone from Imphal.
"Definitely one of the valley based militant group must have carried out the attack," he added.
The motive for the explosion was not immediately known. No rebel group has yet claimed responsibility.
The two fatalities had come to Imphal to sell vegetables at a market run by women in the area, while two of the six injured were women vendors.
Manipur has long been affected by insurgent violence and is home to dozens of tribal groups and small guerrilla armies. They often compete against each other in turf wars for dominance in the state.
The militants say the northeast has been largely neglected by political leaders at the Centre, accusing them of focusing only on the development of the country's relatively wealthier eight northern states.