The Chief Constable of the RUC, Sir Ronnie Flanagan, has blamed the "Real IRA" for an early-morning explosion on the Dublin to Belfast railway line a few miles outside Newry, Co Down.
The explosion occurred at around 2.30 a.m. after a number of Belfast newsrooms received coded warnings from a caller who would not identify the organisation she represented.
It would appear that a powerful charge was used, causing a large crater and bringing cross-Border rail services to a standstill yesterday. Services were disrupted all day as Northern security forces examined the stretch of track where the device was left.
A man was reported to have knocked on windows and doors of houses along the track earlier in the night, telling residents they had two hours to leave their houses.
The "Real IRA" is reported to have grown in strength and is known to have acquired plastic explosives and electrical detonators from arms sources in eastern Europe.
The British Army Explosives Ordnance Disposal (EOD) team sent to examine the site yesterday is holding back while the area is searched thoroughly for booby-trap mines.
Security sources in the area say one of the Provisional IRA's leading bomb-makers recently defected to the "Real IRA" and that he would be capable of making sophisticated booby-trap devices. This was a tactic used in the past by the Provisionals in south Armagh.
It is expected it will take two days before the EOD team clears the scene around the explosion. The RUC said there were no reports of injuries, although the tracks suffered minor damage.
The Border area of south Armagh and north Co Louth is known to be a base for dissident republicans, but sources say this is the first time they have targeted the Dublin-Belfast railway line.
The British Prime Minister, Mr Tony Blair, yesterday departed from the text of a speech he was delivering in Tubigen, Germany, to say the explosion was evidence that there were still people who objected to the peace process.
Speaking at the Global Ethics Foundation, an organisation working for Catholic-Protestant reconciliation, Mr Blair said: "Engagement and dialogue have shattered the depressing status quo of the past. Of course, there are those who reject this change . . . people who believe that if you don't fit in with their view of the world, you don't belong. But they are the minority.
"What is the fundamental lesson of Northern Ireland for us all? For me, it is this: there is no place in the 21st century for narrow and exclusive traditions. It underlines the supreme importance of understanding our dependence on one another for future progress."
Local politicians condemned the explosion. The Ulster Unionist MLA for the area, Mr Danny Kennedy, said nothing would ever be gained by the use of violence. "I would appeal to the wider community to fully support the RUC in their search for the perpetrators of this cowardly act."
The SDLP MLA, Mr John Fee, condemned "a stupid action" which would achieve nothing.
"Those behind it want nothing other than a return to chaos. They offer nothing for the future. This action is intended to grab a few headlines and to raise tensions at a sensitive time," he said.