Dissident republicans have been blamed for planting a bomb on a bus in Northern Ireland.

Police said a masked man ordered the viable explosive device to be transported to the main police station in Derry last night.

Superintendent Stephen Cargin said it was capable of causing death or serious injury.

The alert began at about 6.15pm yesterday when the masked man boarded the bus in the Ballymagroarty area.

The bomb, which was concealed inside a holdall and had a two-hour timer, was placed directly behind the driver's seat.

There were up to ten passengers on board at the time and they were ordered off.

The driver was able to abandon the bus in a place of safety in the Northlands area and raise the alarm.

She has been left extremely distressed by the ordeal.

Supt Cargin said she should be praised for her bravery.

He said: "To be prepared to put a bomb on a public bus, to put the lives of the driver and the passengers at risk and in the knowledge that it had to be driven through a built up area is totally mindless."

The suspect was dressed in a black jacket and used a black scarf and hood to hide his identity.

Supt Cargin said he claimed to have been from the IRA.

"We believe this was one of the dissident groups," he said.

In the past, dissidents have forced taxi drivers to transport bombs but it is understood this is the first time a public transport worker has been targeted.

Ciaran Rogan from Translink, which operates the network, insisted services would not be impacted.

Stormont Transport Minister Danny Kennedy condemned those responsible.

He said: "Attacks on public transport impact the entire community who depend on buses and trains to get to work, school, hospital and go about their daily business."

About 70 families from 40 houses were evacuated while army bomb disposal teams worked to make the device safe.

The alert ended at about 3.30am and residents were allowed to return home.

Strand Road PSNI station has been the target of a number of bomb bids including thwarted mortar attacks in March and October.