TWO men have died after a hand grenade apparently exploded in their car in the Austrian capital.

Police found the men in a Bulgarian-registered car in Vienna's Ottakring district early yesterday after a passer-by reported hearing shots or an explosion. One man in the car was already dead and the other died at the scene.

Police were working to identify the men, believed to be around 50.

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The Austria Press Agency quoted police spokesman Thomas Keiblinger as saying officials "have no indications that the grenade was thrown into the car".