An explosion hit a Syrian military truck escorting a convoy of UN observers near the city of Deraa, just seconds after UN staff had passed by.
Major General Robert Mood, the head of the UN monitors, was in the team's convoy but there were no reports of any of the observers being wounded.
At least three Syrian soldiers were wounded and the windows of the truck were shattered, according to eyewitness accounts.
An Associated Press reporter travelling in the UN convoy said the explosion blew out the military truck's windows and caused a plume of thick black smoke.
Mood, told reporters that attack was "a graphic experience that the Syrian people live with every day." He said the observers' work will continue as usual.
Mood said he does not know whether the blast was meant to target the observers or the military.
"For me the important thing is really not speculating about who was the target, what was the target, but it is to make the point that this is what the Syrian people (are) seeing every day and it needs to stop," he said. "Whoever is doing it and whoever is supporting it."
It's not clear who was behind the bombing.
Meanwhile, Syria's rebel leader, Col. Riad al-Assad, has threatened to resume attacks because the government has not honored a cease-fire, the London-based Asharq al-Awsat newspaper reported Wednesday. Al-Assad told the paper that, "our people are demanding that we defend them."
On Tuesday, Kofi Annan gave a bleak assessment of the crisis in Syria, saying violence remains at "unacceptable levels" and warning that his peace plan is the country's last chance to avert a disastrous civil war.
Approximately seventy UN observers are now in Syria and, despite their presence, activists report that dozens of people are killed daily and that there has been a recent surge of bombings targeting state security.