Malian special forces stormed a luxury hotel in Bamako on Friday after Islamist gunmen took 170 people including many foreigners hostage in the capital of the former French colony, which has been battling rebels allied to al Qaeda for several years.
"They've penetrated inside the hotel. The operations are under way," a police source told Reuters.
State television said 80 hostages had been freed but the French newspaper Le Monde quoted the Malian security ministry as saying at least three people had been killed in the initial attack. A witness outside the hotel said gunfire could be heard from time to time.
The raid on the Radisson Blu hotel, which lies just west of the city center near government ministries and diplomatic offices in the former French colony, comes a week after Islamic State militants killed 129 people in Paris.
The identity of the Bamako gunmen, or the group to which they belong, is not known.
Northern Mali was occupied by Islamist fighters, some with links to al Qaeda, for most of 2012. They were driven out by a French-led military operation, but sporadic violence has continued in Mali's central belt on the southern reaches of the Sahara, and in Bamako.
The security source said as many as 10 gunmen had stormed the building, firing shots and shouting "Allahu Akbar", or "God is great" in Arabic. The hotel's head of security said two private security guards had been injured in the early stages of the attack, which began at 7am(0200 ET).
A French presidential source said French citizens were in the hotel. The Chinese state news agency Xinhua said several Chinese tourists were among those trapped inside the building. Turkish Airlines also said it had six staff inside.
The company that runs the hotel, Rezidor Group, said it understood that there were two gunmen.
"According to our information, two people are holding 140 clients and 30 employees," it said in a statement.
Witnesses in the area said police had surrounded the hotel and were blocking roads leading into the neighborhood.
The US Embassy tweeted that it was "aware of an ongoing active shooter operation at the Radisson Hotel," and instructed its citizens to stay indoors.
An Islamist group claimed responsibility for the death of five people last March in an attack on a restaurant in Bamako that is popular with foreigners.
And in August, 17 people were killed during an attack on a hotel in Sevare in central Mali, some 600 km (375 miles) northeast of Bamako, that was claimed by the Sahara-based Islamist militant group al-Mourabitoun.
The dead in Sevare included nine civilians, five of whom worked for the UN mission in Mali (MINUSMA), as well as four Malian soldiers and four militants.
In the wake of last week's Paris attacks, an Islamic State militant in Syria told Reuters the organization viewed France's military intervention in Mali as another reason to attack France and French interests.
"This is just the beginning. We also haven't forgotten what happened in Mali," said the non-Syrian fighter, who was contacted online by Reuters.
"The bitterness from Mali, the arrogance of the French, will not be forgotten at all."
