Police said the explosion happened near a popular Lebanese restaurant in Wazir Akbar Khan, but could not immediately confirm the nature of the blast.
"There has been an explosion near the Lebanese restaurant in Wazir Akbar khan, and gun shots have also been fired," Sayed Gul Agha Hashemi, head of Kabul police's criminal branch, told AFP.
The Afghan capital has often been hit by suicide and bomb attacks, with the most recent incident last Sunday when a Taliban suicide bomber riding a bicycle detonated himself next to a police bus, killing a policeman and a civilian.
A series of attacks in 2013 targeted foreign compounds, the Supreme Court, the airport and the presidential palace in Kabul.
NATO forces are withdrawing from Afghanistan after more than a decade of fighting the Taliban, but negotiations have stalled on a security accord that would allow some US and NATO troops to stay after 2014.
Afghanistan's fledgling security forces face a difficult year in 2014 as insurgents attempt to disrupt elections on April 5 that will choose a successor to President Hamid Karzai, and as NATO's combat mission winds down by December.
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