(Adds Islamic State claim, background)

By Ayman al-Warfalli

BENGHAZI, Libya, May 19 (Reuters) - One person was killed and seven were wounded on Tuesday in a suicide bombing claimed by Islamic State militants in the eastern Libyan town of Qubbah, a security official said.

Islamic State has exploited a security vacuum in Libya, four years after the overthrow of Muammar Gaddafi, as rival governments compete for power. It has built up a presence in Derna, a city to the east of Qubbah.

The militants have claimed several high profile attacks on foreigners in Libya this year, including an assault on the Corinthia Hotel in Tripoli and the killing of dozens of Egyptian and Ethiopian Christians.

A car packed with explosives hit a checkpoint in the east of Qubbah, a small town, a security official said.

Islamic State militants claimed responsibility for the attack in a message on Twitter, saying a fighter from Derna had killed and wounded several people.

Qubbah lies near the seat of the internationally recognised government, which has worked out of eastern Libya since losing the capital Tripoli in August to a rival group which set up its own administration.

In February, militants loyal to Islamic State claimed responsibility for a car suicide bombing that killed 42 people in Qubbah in apparent retaliation for Egyptian air strikes following the killing of 21 Egyptian Copts by the group.

Islamic State militants have also claimed assaults on embassies in Tripoli including the Egyptian and Algerian missions. Most of the embassies are empty because countries have pulled out diplomatic staff due to the security situation.

(Reporting by Ayman al-Warfalli and Ahmed Tolba; Writing by Ulf Laessing; editing by Dominic Evans) ((ulf.laessing@thomsonreuters.com; follow me on twitter @ulflaessing; Tripoli newsroom; Reuters Messaging: ulf.laessing.reuters.com@reuters.net))

Keywords: LIBYA SECURITY/