The Israeli military said it was investigating an apparent drone attack that hit central Tel Aviv in the early hours of Friday but which did not trigger the air raid sirens.
The explosion occurred hours after the Israeli military confirmed it had killed a senior commander of the Iran-backed Hezbollah group in southern Lebanon.
"An initial inquiry indicates that the explosion in Tel Aviv was caused by the falling of an aerial target, and no sirens were activated. The incident is under thorough review," the Israeli military said in a statement.
It said air patrols had been increased to protect Israeli airspace but said it had not ordered new civil defence measures.
Police said the body of a man was found in an apartment close to the explosion and said the circumstances were being investigated.
Footage from the site showed broken glass strewn across the city pavements as crowds of onlookers gathered near a building bearing blast marks. The site was sealed off by police tape.
The military spokesman of Yemen's Houthis said the group would reveal details about a military operation that targeted Tel Aviv in a statement on social media.
Hezbollah and the Houthis have stepped up attacks against Israel and Western targets, saying they are acting in solidarity with the Palestinians after Israel invaded the Gaza Strip following an attack by Hamas on southern Israel.
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