A mysterious man and a small can of gasoline are behind an explosion that rocked a downtown Toronto Tim Hortons, killing him and causing a city block's evacuation.

The blast occurred Sunday afternoon in the washroom of the coffee shop, located north of the intersection of Yonge and Bloor Streets, just after 1 p.m. EDT.

"We were just sitting down there beside the washroom and then all of a sudden, big explosion," witness George Ribera said. "That's why we just came out. Everybody ran out."

Emergency crews responded to the scene. Firefighters found the badly burned body of a man in one cubicle. They couldn't revive him.

He is not an employee of the restaurant and the authorities haven't identified him. No other injuries were reported.

"The scene indicates a very intense, very hot flash fire that took place at that location," Police Chief Bill Blair told reporters.

However, fire department spokesman Daryl Fuglerud said a fire did not break out in the building after the blast.

Initial fears were that a bomb might have been involved -- an erroneous radio news report said a man wearing explosives strapped to himself had entered the shop -- led to the area being cordoned off and the bomb disposal unit dispatched to the scene.

Police blew up an unattended duffle bag in a nearby alley as a precaution.

Police said an unidentified man went into the coffee shop's washroom carrying a gasoline container.

Another man smelled gasoline fumes and ran out, yelling. A few moments later the blast occurred, they said.

"We are still determining whether or not it was a purposeful act or an accident. We are very early on in our investigation," Blair said.

Investigators do not know what ignited the gasoline or what the deceased man's motives were. Suspicion is focusing on either suicide or arson. They say he was definitely not a terrorist.

"He's not a strap-on, al Qaeda bomber guy," Toronto Police Staff Sgt. Don Cole said Sunday evening. "It sounds to me like a guy who either wanted to do a torch job or commit suicide."

There is no word yet on what caused the gasoline to ignite. The fire marshal's office will join the investigation.

Later Sunday afternoon, another Tim Hortons outlet in Toronto was locked down after a suspicious package was found near the restaurant, several kilometres north of where the explosion occurred.

Police confirmed they sent an emergency task force unit to the second location and the area around the shop had been evacuated.

"There was a call by the people that worked at Tim Hortons doughnuts that a package had been left by a customer and they just were concerned about it, given what had transpired," Blair said.

Cole said the package turned out to be a clock in a shopping bag.

Scene of panic

Witnesses described a scene of panic inside the restaurant after the explosion.

"A lot of people screaming and screaming," one young woman said.

Police cordoned off approximately one city block and evacuated the area as a precaution.

They questioned employees and witnesses near the coffee shop about what they had seen.

Several hours after the explosion, Tim Hortons District Manager Amin Islam escorted the employees away.

The employees appeared shaken by their experience, but Islam said they were doing well.

"I'm just making sure they're going home safely," he said.

Islam said he learned of the blast from radio news reports and immediately rushed to the scene to see what he could do.

With reports from CTV's Denelle Balfour and John Musselman, plus files from The Canadian Press