Greek anti-terror investigators have arrested a man in connection with a deadly explosion in Athens, police said on Saturday, warning of "a new generation of terrorists" at work.

Thursday's blast in an apartment in the capital, which killed a man and seriously injured a woman, is suspected to have been caused by the accidental detonation of a homemade bomb.

Police sources told AFP they had identified the dead man from his dismembered remains as a 36-year-old from the port city of Piraeus who had been previously arrested in Germany.

His fingerprints were in the international database of Europol, the European Union's law enforcement agency, the sources added.

Investigators have also opened a case for alleged participation in a terrorist organisation and committing terrorist acts against the injured woman, 33, who was hospitalised under police supervision, and another 30-year-old woman who remains at large.

In their statement on Saturday, police said that the arrested man was detained after turning himself in on Friday.

He is believed to have a connection with one of the two women wanted in the case, but has denied having anything to do with the explosion, police said.

According to Athens News Agency, prosecutors have issued arrest warrants for the women and have charged them and the man with four terror-related criminal offences and two misdemeanours. 

Police said that a search of the apartment produced two handguns, wigs and face masks among other materials.

Greek police sources told AFP that investigations were ongoing and the deceased and those charged were probably members of "a new generation of terrorists".

The country has a decades-old history of far-left extremism involving small urban groups.

The shadow November 17 group, named after an anti-junta student uprising, was behind the 1975 killing of the CIA’s Athens station chief Richard Welch, and claimed responsibility for assassinating 23 people in scores of attacks on US, British, Turkish and Greek targets between the 1970s and 1990s.

In the past decade, scores of arson and bomb attacks in Greece have hit financial, diplomatic and political targets, with police blaming radical anarchists.