Chabahar city governor Rahmdel Bameri said earlier that four people were killed and many more wounded when the bomber blew up a auto, but later revised the death toll to two.
Videos posted on Twitter, purportedly from Chabahar, showed thick smoke rising from the area.
"Mark my words: Iran WILL bring terrorists & their masters to justice", the foreign minister emphasized.
An official told TV that "the terrorist who carried out the attack was killed".
An Iranian ethnic Arab separatist Sunni militant group and Islamic State both claimed responsibility for that attack.
The bomber drove his vehicle, loaded with explosives, up to the police headquarters, provincial official Rahmdel Bameri told state TV.
He was referring to the capture, trial and subsequent execution in June 2010 of Abdolmalek Rigi, the leader of militant group Jundallah who had waged a deadly insurgency in Sistan-Balochistan.
The southeastern port city in Iran's Sistan and Balochestan province is located near the border with Pakistan.
The site of a terror attack in Chabahar a port city in Iran's southeastern Sistan-and Baluchestan Province
Al-Furqan in 2017 claimed responsibility for bombing an oil pipeline in the southwestern province of Khuzestan.
While rare, Iran has been targeted by armed groups in recent years.
Chabahar lies some 100 kilometres (60 miles) west of the Pakistan border and is home to a large Balochi community which straddles the two countries.
Foreign Office Spokesperson Dr Muhammad Faisal, in a tweet message had strongly condemned the terrorism in Iran's port city of Chahbahar.
Chabahar is also the site of a port complex, which is being developed in cooperation with India as part of a new transportation corridor for landlocked Afghanistan.
Iran has stepped up security in border areas after gunmen in September opened fire on a military parade in Iran's southwestern city of Ahvaz, killing 25 people, nearly half of them members of Iran's elite Revolutionary Guards corps.
Iranian Foreign Minister Javad Zarif blamed "foreign-backed terrorists" for the attack. "There can be no justification for any act of terror", the MEA said.More news: Qualcomm Snapdragon 855 SoC & Snapdragon Elite Gaming Accidentally Revealed
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