(Recasts with police saying suspects not related to blasts)

MEXICO CITY, Sept 18 (Reuters) - Mexican police questioned three men suspected of links to grenade attacks on an independence day celebration but determined they had nothing to do with the blasts, federal prosecutors said on Thursday.

The three suspects were arrested in the western state of Zacatecas earlier in the day after police received an anonymous tip, local authorities said.

Monday's attack in the colonial city of Morelia, capital of the drug gang-infested state of Michoacan, killed seven people.

"It was established the men are not linked (to the blasts)," the attorney general's office said in a statement.

Mexican authorities have pointed the finger at drug gangs but no group has come forward to claim responsibility.

The attack appeared to be the first major strike by cartels on ordinary citizens. More than 100 people, including women and children, were wounded.

The men detained in Zacatecas were transferred to a military facility and were being treated for injuries suffered in an auto accident, the state government said.

Police in Morelia were examining eyewitness reports of a man seen apologizing before lobbing a grenade.

More than 2,700 people have been killed so far this year in Mexico in a wave of drug-related violence as rival cartels battle each other and security forces.

President Felipe Calderon, a native of Michoacan state, has vowed to crush cartel violence and on Thursday announced that the government would start paying rewards to people who turn in organized crime suspects. (Reporting by Robert Campbell and Jason Lange; Editing by Eric Beech)

AlertNet news is provided by