No militant group has immediately claimed responsibility for the attack.
At least two police officers lost their lives and some 40 other people sustained injuries in the explosion, which also killed the bomber. Reuters could not verify their authenticity.
Chabahar is located in the southeastern province of Sistan and Baluchestan, which is home to a Sunni minority in the largely Shia country, and has always been plagued by violence from both drug smugglers and separatists.
Chabahar lies in Sistan-Baluchistan province which has always been a flashpoint, with Pakistan-based Baluchi separatists and Sunni Muslim extremists carrying out cross-border attacks targeting the Shiite authorities.
Rahmdel Bameri, Chabahar's acting governor, was among the Iranian officials who said two victims were killed by the December 6 car-bomb attack.
Last year, in the first deadly assault claimed by Islamic State in Tehran, 18 people were killed at the parliament and mausoleum of Ayatollah Ruhollah Khomeini, founder of the Islamic Republic. Ansar al-Furqan is known to operate in Iran's southeastern Sistan and Baluchistan Province, which sees occasional attacks by Baluch separatists and drug traffickers.
Tehran often blames the United States, Saudi Arabia and Israel for backing groups to destabilize Iran, something its rivals deny.
Plumes of Smoke Rise Over Iranian City of Chabahar After Blast
"In 2010, our security services intercepted & captures extremists en route from UAE".
Chabahar is a free trade zone and the site of an Indian-backed port complex which is being developed as part of a new transportation corridor for land-locked Afghanistan.
Iran also says that militant groups are sheltering across the border in Pakistan and has threatened to attack their bases if Islamabad does not confront them.
India is developing the Chabahar port along with Iran and Afghanistan.
"Iran will bring terrorists and their masters to justice", he wrote on Twitter.
Foreign Office Spokesperson Dr Muhammad Faisal, in a tweet message had strongly condemned the terrorism in Iran's port city of Chahbahar. "There can be no justification for any act of terror", the ministry said.
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