The rebel Liberation Tigers of Tamil Eelam (LTTE) set off the surface mounted mine at Nilaveli, a former popular tourist spot, as sailors were on a foot patrol, a local official said.
"One died on the spot while the other succumbed to his injuries after being taken to the Trincomalee hospital," a police official said as a magisterial inquiry got underway.
The attack came as Sri Lanka's key foreign aid donors -- the United States, the European Union, Japan and Norway -- in a joint statement asked both the government and the Tigers to refrain from military action.
The quartet said a Sri Lankan military bomb attack Thursday inside the rebel political capital of Kilinochchi had hit a house, killing five people and damaged the nearby hospital where patients fled in fear.
Sri Lanka's defence ministry has accused the LTTE of gearing up for a major offensive following the failure of the latest peace talks in Geneva last weekend and ahead of their leader's birthday later this month.
Both the government and the Tigers have pledged not to initiate military action. They say they have only been acting in self-defence.

Copyright AFP (Agence France-Presse), 2006