Bolivia's interior minister says his government has seized three shotguns, a revolver and more than 2,300 rounds of ammunition from a vehicle owned by the U.S. Embassy.
The minister claims the weapons were being transported without authorization and posed a security threat.
But the U.S. Embassy says the weapons confiscated Tuesday were being transferred under an agreement with Bolivia's police. It said in a statement that Washington routinely contracts and arms local police in foreign countries to protect its diplomats.
Interior Minister Carlos Romero told reporters that the vehicle's driver and a police officer accompanying him were detained pending investigation.
Bolivia's leftist government expelled the U.S. ambassador and U.S. drug agents in 2008, accusing them of inciting the opposition.
Relations have recently improved, with both sides agreeing to restore ambassadors.