Prague police spokesperson Tomas Hulan told AFP the device was found during a sweep of the embassy and had been sent to a forensic lab for analysis.
He refused to provide further details or to confirm or deny media reports that the explosive was found inside a book.
- Weapons found in Palestinian envoy's mission in Prague
- Palestinian representative to Prague killed in explosion
- Blast killing Palestinian envoy 'not an accident'
Ambassador Jamal al-Jamal, 56, died January 1 in a blast that went off shortly after he opened a safe. Police have ruled out foul play.
But the late diplomat's daughter Rana al-Jamal has said she believes her father was murdered.
After the blast, police found 12 firearms at the embassy, including submachine guns and side-arms that were not officially registered in the Czech Republic. Palestinian officials told Czech police that communist authorities gave the arms to Palestinian diplomats in Prague as a gift, according to Hulan.
On Tuesday, Palestinian diplomats issued an official apology for the "illegal presence of weapons" at the embassy and for "the incident that resulted in the tragic death of" Jamal, according to a Czech foreign ministry statement.