A suicide bomber blew himself up at a military parade rehearsal in Yemen's capital yesterday, killing more than 90 soldiers in one of the deadliest attacks in the city in years.

The bomber, dressed in military attire, made his way to the back of the military parade, near the presidential palace in Sana'a, before detonating explosives strapped to his chest. The explosion was small, but the suicide bomber's proximity to those around him meant it was devastating.

"Fifty men died right there on the spot," said Colonel Mohammed al-Kibsi, pointing to the blackened scar the bomb had left on the tarmac, his hands and uniform splattered in blood. "This was a massacre … The brave soldiers of our fatherland died this morning in cold blood."

By nightfall more than 90 men had died of their injuries.

The bombing, which wounded another 200, was the bloodiest incident in the city in years and dealt a serious blow to a political transition under way after a year of violent political upheaval that unseated Yemen's dictator, Ali Abdullah Saleh, after 33 years in office.

Local Arabic press reported al-Qaeda as saying it had carried out the attack, though none of the group's senior members has yet verified the claim.

The bombing was the first pedestrian suicide bomb attack in Sana'a since April 2010, when a man blew himself up in an attempted attack on the British ambassador, Tim Torlot.

The parade was a rehearsal for a ceremony due to be held on Tuesday to celebrate the 22nd anniversary of the country's unification between north and south. A spokesman for the interior ministry said the attack "carried all the hallmarks of al-Qaida", but insisted the parade would go ahead on today as planned.

Yemen's newly installed president, Abd-Rabbu Mansour Hadi, who was due to attend the celebrations, responded to the bomb attack by firing two senior commanders, both allies of his predecessor, Saleh. One of them, a nephew of Saleh's, was the head of national security, an elite intelligence gathering unit that works closely with the CIA.

"Our armed forces and security forces will become tougher and more determined in stamping out terrorists," the state news agency, Saba, quoted Hadi as telling the victims' families in a condolence message.

The scene of the attack, a 10-lane through road usually filled with heaving traffic was desperate and chaotic. Soldiers with blood on their uniforms stood in confusion among a scattering of fingers, feet and soldiers caps. The area was cordoned off with yellow tape and a forensic team was examining the site last night.

Many suspected that the bombing was a show of force by the terrorist organisation for a huge offensive launched last week by US-trained Yemeni army units to try and uproot Ansar al-Sharia, ("Partisans of Islamic Law") an al-Qaida-affiliated group that has seized on Yemen's unrest, taking towns and villages in the southern province of Abyan.

Dozens of militants, soldiers and civilians have been killed in the past week as Yemeni troops, backed by heavy artillery and warplanes, sweep east from the port city of Aden, use tanks and rockets to try to dislodge al-Qaida from the mountains of Abyan.

Sheltering among residents in local villages, the militants are fighting a guerrilla war, using artillery seized in raids on army outposts to stave off the army's advance.

The tussle for territory in the south is of grave concern to the Pentagon, which believes al-Qaida in the Arabian Peninsula (AQAP) to have established the most dangerous base of operations in the Arab world.

The Obama administration recently stepped up a decade of US covert operations in Yemen, using unmanned drones flown across the Red Sea from Djibouti to target wanted insurgents. A plot last month by AQAP to blow up a US-bound airliner – the third attempt in as many years – was foiled by a CIA undercover agent masquerading as a suicide bomber.

Two Americans, part of a team of instructors in Yemen to train the country's coastguard, were injured on Sunday when al-Qaida militants sprayed their vehicle with bullets as they were driving through the Red Sea city of Hudaida, a Yemeni coastguard officer said.

They were the first US military personnel to be injured in Yemen since the bombing of the USS Cole, in 2000.