(Reuters) - A bomb exploded outside the republican palace in the Yemeni capital Sanaa on Saturday and wounded three Shi'ite Muslim militiamen guarding it, eyewitnesses said.

The attack raised tensions a day after the Houthi Shi'ite militant group dissolved parliament and formally took power of the impoverished and strife-torn Arabian Peninsula country.

Once the home of the resigned Yemeni prime minister, the republican palace now houses Mohammed al-Houthi, a top official in the Iranian-backed movement's military wing whose gunmen hold sway over much of Yemen.

There was no immediate claim of responsibility for the blast, but Sunni Muslim militants in al-Qaeda in the Arabian Peninsula (AQAP) have repeatedly clashed with the increasingly powerful Houthis, raising fears of an all-out sectarian war.

Separately, thousands of demonstrators gathered in three cities in central Yemen to protest the Houthis seizing power. Houthi gunmen dispersed dozens of activists near the capital's main university by firing into the air.

Protesters chanted slogans calling the Houthi moves a "coup" and demanded the group withdraw its forces from major cities.

The Houthis entered Sanaa in September and began to fan out into more cities in Yemen's south and west. Armed Houthi personnel were out in force after their Friday announcement, manning checkpoints around key government buildings.

Their spread has destabilized the country's fragile security forces and stoked anger among tribal fighters allied to AQAP.

Four Houthi fighters were killed in a suspected AQAP attack in the southern al-Bayda province on Friday, while army forces clashed with tribesmen and AQAP fighters in a neighboring district on Saturday.

(Writing by Noah Browning; Editing by Mark Heinrich)