The bus was en route from the Jewish settlement of Netzarim in central Gaza to Israel when the explosion went off.
Fifteen people were on the bus, and Israel Radio said a woman passenger was hurt and being treated on the scene. Moshe Hiller, a resident of Netzarim, said he had reports of at least two people being hurt.
There was no immediate claim of responsibility. Earlier this week, the Islamic militant group Hamas carried out four suicide bombings over a 48-hour period, killing 12 Israelis and wounding dozens.
Also Friday, Palestinian officials said they would not accept any changes to a U.S. backed-Middle East peace proposal. The statements came after Israel signaled it might give cautious support to the plan, but only if some of its objections were taken into account.
The plan, know as the "road map," calls for an immediate end to violence, the dismantling of some Israeli settlements in the West Bank and Gaza Strip and the creation of a Palestinian state by 2005.
The Palestinians have accepted the road map, while Israel has expressed major reservations.
Despite the obstacles, Sharon for the first time signaled qualified support Wednesday for the peace plan, an Israeli official said late Thursday, speaking on condition of anonymity in Washington. He told the White House through an emissary that he would go along with it as long as the United States took Israel's concerns into account. A White House announcement was expected Friday.
A senior Israeli official said it was unclear whether Sharon would present the road map for a vote at his weekly Cabinet meeting Sunday. Israel wants its key objections noted in the plan, said the official, speaking on condition of anonymity.
The Palestinians said they had been assured by the United States that there would be no changes in the plan, and that they had accepted it based on this promise.
"We are ready to implement the road map as one package ... and without any changes," Palestinian Information Minister Nabil Amr said Friday.
One major obstacle to adopting the road map is a disagreement between Sharon and Palestinian Prime Minister Mahmoud Abbas over how to deal with Palestinian militant groups that carried out scores of shootings and bombings in the past 32 months of fighting.
In the first phase of the peace plan, Palestinian security forces would rein in the militants, and Israel would withdraw from Palestinian towns and stop expanding Jewish settlements.
Abbas wants to persuade militants to lay down their arms, while Sharon insists they be disarmed and arrested.
Abbas summoned leaders of the Islamic group Hamas to his Gaza City office Thursday in his first visible effort to help end attacks on Israeli civilians.
Abbas is trying to avoid using force against the militias, in part because he may not have enough of a power base to risk a full-fledged confrontation. Hamas has grown in popularity in the West Bank and Gaza Strip, where many Palestinians are embittered by Israeli military strikes and travel bans that cause much hardship.
Palestinian Cabinet Minister Ziad Abu Amr, who participated in the meeting, said using force against the militants "would be counterproductive."
Earlier this week, Hamas and other Palestinian militias carried out five suicide bombings that killed 12 Israelis and wounded dozens. Abu Amr said the militants apparently unleashed these attacks in part because they wanted to begin truce talks from a position of strength.
Hamas officials told Abbas said they were ready for a partial truce — halting attacks on civilians in Israel, but continuing to target Israeli settlers and soldiers in the West Bank and Gaza Strip — but only if Israel stopped hunting its members.
"We told him (Abbas) that ... if the Zionist enemy stopped his aggression ... the Hamas movement might stop its attacks against civilians, which does not include settlers and the occupation army presence in the Palestinian land," said Hamas spokesman Ismail Hanieh. Hamas officials said they would hold more talks with Abbas.
Sharon adviser Raanan Gissin dismissed the idea of a partial truce. "They can murder just a little and we can stop defending ourselves?" Gissin said. "This is a non-starter."'
On Friday, the Israeli military destroyed a house belonging to the family of Hiba Daraghmeh, the 19-year-old bomber who killed herself and three Israelis Monday in a suicide attack outside a shopping mall in the northern Israeli city of Afula. Nine others lived in the house in the village of Tubas, northeast of the West Bank city of Nablus.
President Bush is considering a three-way meeting with Sharon and Abbas in Egypt to prod them into implementing the road map, officials involved in the planning said Thursday.
However, the meeting would only occur if both sides take steps toward peace in the coming days, a senior Bush administration said on condition of anonymity.
In Washington, Palestinian Finance Minister Salam Fayad met Wednesday afternoon with Bush. Fayad, a former International Monetary Fund official, is one of the most respected members of the Palestinian Cabinet.
Just before Abbas' meeting with Hamas, Israel announced it had intercepted a boat heading from Lebanon to Gaza carrying a top Hezbollah explosives expert, 25 rocket detonators and 36 CD-ROM disks with instructions on how to assemble bomb belts for suicide attacks. The boat also had a radio-activation system for remote-control bombs, the military said.
Israeli officials said the Palestinian Authority and Palestinian leader Yasser Arafat were behind the shipment with the aim of setting up a "bomb school" in the Gaza Strip.