The attacker detonated explosives strapped to his body inside the security checkpoint at the side entrance to the embassy, blowing away a door and sending debris flying into the street
Turkey's interior minister Muammer Guler said the bomber was a member of an illegal far-left group but there was no immediate claim of responsibility for the attack.
"We're very sad of course that we lost one of our Turkish guards at the gate," US ambassador Francis Ricciardone said, speaking from the embassy shortly after the bombing.
Two other security guards and a journalist were wounded in the blast.
Television footage showed a door blown out and masonry from the wall around it scattered in front of the entrance, although there does not appear to be any more significant structural damage.
"It was a huge explosion. I was sitting in my shop when it happened," said travel agent Kamiyar Barnos, whose shop window was shattered around 100 metres away from the blast.
"I saw what looked like a body part on the ground."
Turkish media reports identified the bomber as Ecevit Sanli, a member of the Revolutionary People's Liberation Party-Front (DHKP-C) leftist group, who was involved in attacks on a police station and a military staff college in Istanbul in 1997.
The DHKP-C opposes what it sees as US influence over Turkish foreign policy.
It was the second attack on a US embasasy in four months.
On September 11 last year, US ambassador Christopher Stevens and three American personnel were killed in an attack on the US consulate in Benghazi, Libya.