Thousands of protesters marched through the streets of Charar-e-Sharif, accusing police of throwing a hand grenade into a mosque and killing four people.
Schools and businesses in the city, 18 miles west of Srinagar, Kashmir's summer capital, were closed as about 5,000 demonstrators marched to protest Friday's attack.
Some protesters said they saw two people in police uniforms on a hill near the mosque and one of them threw the grenade. The government has promised to investigate.
The grenade killed four women and wounded 62 other people.