Army personnel had come across the suspected guerrilla wearing a jacket packed with explosives while manning a road block at Savalkattu junction around Friday afternoon.
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The suspect tried to trigger a blast when troops attempted to body search him, the military said.
There was no comment from the rebels, who are fighting for an independent state for minority Tamils from the majority Sinhalese community since 1972.
Elsewhere in the northeastern district of Vavuniya, a soldier was injured when Tiger rebels fired at troops manning the forward defence line late Thursday.
The Tigers said they repulsed a military advance into the coastal district of Manner in northwest Sri Lanka, as hundreds of soldiers backed by artillery and rockets mounted attacks into rebel territory.
The guerrillas said they resisted the offensive and pushed the military back to its original positions, even as heavy long-range attacks raged on the other side of the island in the Batticaloa district.
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