There was no warning given for the explosion that damaged up to 30 buildings, including shops, offices, banks and a church. It was the second bomb in six months to rip through the predominantly Protestant seaside town, 10 miles from Belfast.
The late-night bars, discos and clubs had closed and the four officers, all part-time reservists, were walking up Main Street towards the Royal Ulster Constabulary station at 2.45am when the bomb was detonated.
Detectives have appealed for people waiting for taxis in the town centre and outside the railway station to help trace the terrorists, who they believe may have been hiding nearby when they triggered the device, estimated to have weighed several hundred pounds.
The officers were treated for fractured bones, cuts and shrapnel wounds and it is believed the policewoman, who is married with two children, was the most badly hurt. The condition of the officers remained serious last night.
The bombing came just hours after IRA gunmen tried to kill two leading loyalists in the Protestant Shankill district of Belfast. One was hit, but not badly hurt, when their car was sprayed with gunfire in Berlin Street.
Last night, a policeman was shot and wounded outside an RUC station near the centre of Belfast. The attack happened on the Grosvenor Road on the edge of the republican Lower Falls district.
The condition of the officer was not immediately known, but police said he was hit in the leg.
Earlier, near Dungannon, Co Tyrone, a nine-year-old Protestant boy was grazed in the hip when gunmen fired on his father, a former Ulster Defence Regiment soldier, at their home.