The grenade was detected by the public at around 6 AM near Synod Point in the heart of the town, police said.
The locals informed the police about the explosive and security forces later defused it safely, the police said.
Meanwhile, the indefinite curfew in Haflong clamped from September 28 was withdrawn from 6 PM yesterday following improvement in the law and order situation with no report of any fresh incidents of violence.
Prohibitory orders were also discontinued in view of the withdrawal of the Dima Hasao bandh called jointly by the North Cachar Hills Indigenous Peoples' Forum and its students and women wings, official sources said.
Curfew was imposed following violence during a 48-hour bandh called by the NCHIPF to press for bifurcation of Dima Hasao district into two autonomous districts.