They were detained over the robbery bid at a filling station on Annareagh Road, Hamiltonsbawn on Thursday, June 5.
The two men, both aged 37, are currently in custody at Ardmore police station in Newry.
During the incident, a device exploded at the ATM machine, blowing debris across the forecourt.
In a follow up operation, ATO took away a device from the station for forensic examination.
Police have also been hunting a black Audi car in connection with the incident.
It is suspected the same gang was also involved in a bomb attack on an ATM in Carrickmacross just a few days earlier.