The Taliban claimed responsibility for a truck bomb attack on a military and logistics services compound, mainly used by foreigners, in Kabul early on Monday after a powerful explosion was heard all around the city.
A security services official said four heavily armed attackers were fighting on the site of the Northgate Hotel, a secure residential compound for foreign military and civilian organisations.
There was no immediate word on casualties from Afghan authorities, although the Taliban claimed there were "dozens of dead and wounded". The Islamist group often exaggerates the extent of attacks it launches against Afghan government and foreign security targets.
Afghan security forces closed off streets around the site, which is east of Kabul's main international airport and on the way to the sprawling Bagram air base north of the city, immediately after the attack.
Telephone calls to the hotel went unanswered. The hotel's website (www.northgatehotel.com/) says it "provides custom-made Life Support Services to military and civilian organizations in danger zones".
There were also reports of power outages in Kabul after the blast.
A spokeswoman for the NATO-led Resolute Support mission, said they were assessing the situation but gave no details.
A statement from the Taliban claimed responsibility for the attack and said its fighters had entered the compound.
The attack comes around a week after the Islamic State militant group claimed responsibility for a suicide attack on a demonstration by members of the mainly Shi'ite Hazara minority, killing at least 80 people.
The Taliban, which often says it wants to avoid civilian casualties, said the compound was not near homes and that ordinary people were not harmed.