The cause of the explosion was not yet known, police said, but there have been several attacks in the east African port city, popular with Kenyan and foreign holidaymakers, since Kenya sent troops into Somalia in October to crush Islamist militants.
One man was killed immediately in Sunday`s blast, and two of the eight people injured died later in hospital - a nine-year-old boy with shrapnel in his chest and thigh, and a man.
A crowd had gathered at the night club, situated in a residential area, to watch the Euro 2012 football quarter-final between England and Italy.
A day before the blast the U.S. embassy warned of an imminent attack on Mombasa and urged all its staff to leave.
It also said it had suspended travel to the city by embassy staff until July 1.
The suspect now under arrest was taken to hospital after suffering abdominal and leg injuries in the blast, but early on Monday police handcuffed him to his hospital bed and said they needed to question him further.
"One of those wounded people is assisting us with investigations because he is providing contradictory statements. He is being held as a suspect," said Aggrey Adoli, the Coast regional police chief.
At least 15 people have been killed in grenade attacks in Nairobi and Mombasa, including a security guard at a Mombasa night club. There have also been grenade and gun attacks in northeast Kenya near the Somali border.
Kenya has blamed the attacks on al Shabaab, a Somali rebel group which formally merged with al Qaeda this year and has declared war on Kenya because of its incursion into Somalia. (M014)
Editor: Kunto Wibisono
Copyright © ANTARA 2012
