Officials blamed organised crime for the violence on Sunday in the city of Guayaquil.
Gunfire and a subsequent explosion have left at least five people dead, 15 wounded with several others missing in the Ecuadoran port city of Guayaquil.
Government officials blamed the attack on organised crime.
Interior Minister Patricio Carrillo said "organised-crime mercenaries," long involved in illicit drug traffic, were "now attacking with explosives."
"It is a declaration of war against the state," Carrillo added on Twitter.
Eight houses and two cars were destroyed in the blast in Guayaquil, the country's second-largest city, according to the Secretariat for Risk Management.
On its Twitter account, Ecuador's Prosecutor's Office said its agents were gathering evidence to establish the cause and motive for the attack in Guayaquil's Cristo del Consuelo neighbourhood.
Guayaquil, 270 kilometres southwest of the capital Quito, has seen frequent shootings and killings by members of rival gangs believed to have links to national and international drug trafficking.
Dozens were killed last year in massacres inside the largest state prison in the city.