A military reservist who returned from service in Afghanistan last year was injured along with his family when a bullet from the war exploded.

A 25-year-old soldier in Lindenhurst, north of Chicago, was attempting to light a tracer round in his backyard with a blow torch when the ammunition exploded and alarmed residents on his street.

Residents began calling 911 after their homes and windows began shaking from the blast at 9.45pm Saturday night.

An Afghanistan reservist's bullet that exploded in a suburban neighborhood north of Chicago was a tracer round, which are often marked by a different colored tip from other ammunition (file photo)

The reservist and his 23-year-old sister both received 'quite a few superficial wounds,' Lindenhurst police told the Chicago Tribune.

They were released from the hospital Sunday morning and rejoined their parents, who treated their own small injuries.

Tracer rounds contain a combustible compound that leaves a visible trail of the projectiles path.

They can be taken out of their shells and ignited for use as flares, the likely intended outcome of Saturday's incident.

'What he thought would happen didn't,' Lindenhurst commander George Moravec said of the incident, which created a flash explosion.

Moravec added that the reservist, who returned from Afghanistan last fall with the tracer, had a 'respected history in the military'.

Houses on the reservist's street (pictured) were shaken and police are assessing to see if there was any damage

Tracer rounds (pictured in Kobane, Syria, 2014) can be used as flares if removed from their shell and ignited

The exploding bullet was not illegal to own as a civilian and foul play is not expected.

Police are going back to the residents to assess any damage done to property.

Great Lakes Naval Air Station said they will conduct an investigation into the incident.

An estimated $2million in damage was caused at an Indianapolis shooting range last year when a bullet believed to be a tracer round caused a fire, according to WTHR.

The bullet did not explode, but is thought to have smoldered in shredded rubber tires used as a backstop.