Three people have been confirmed dead following a grenade attack that rocked a Mombasa bar at about 10pm Sunday in Mshomoroni, Kisauni.

Kenya Red Cross spokesperson Nelly Muluka has confirmed the report, stating that one person died at the scene of the blast while two victims succumbed to injuries while in hospital.

25 others are still undergoing treatment in hospital.

Witnesses recount that the bar was filled with revelers as well as fans watching the Euro 2012 soccer tournament match between England and Italy.

Reports indicate that two men and a woman arrived in a Rav 4 car, walk towards the bar and shortly afterwards the blasts occurred as the car sped off.

The Provincial Police boss Aggrey Adoli and teams from the Anti-Terrorism and Criminal Investigations departments cordoned off the area even as a large crowd was attracted in the area.

Speaking to journalists Adoli said that only one person is confirmed dead and 10 injured and investigations are already underway to establish the nature and motive of the attack.

The attack comes barely a day after the US Embassy in Kenya warned its citizens of possible terrorist attacks in the coastal area and further withdrawing its officials working at Mombasa.

The US through its website had said: "This is to alert all U.S. citizens in Kenya, or planning to travel to Kenya in the near future, that the U.S. Embassy in Nairobi has received information of an imminent threat of a terrorist attack in Mombasa. All U.S. government travel to Mombasa is suspended until July 1, 2012. All U.S. government personnel are required to leave Mombasa.”

However, the alert was received with denial.

On his part Public Service and Secretary to the Cabinet, Francis Kimemia, had condemned the US alert terming it as reckless and sabotage to the country’s economy.

Kimemia had on Sunday called on the US embassy to annul the announcement which he referred to be in bad taste.

“It is a reckless advisory and it was totally uncalled for,” he said.

Kenya has seen a number of grenade attacks since sending troops into Somalia last year to fight the Islamist al-Shabab militia.

Earlier this year, the African Union force backing Somalia's interim government was boosted from 12,000 troops to nearly 18,000 to incorporate the Kenyan troops.