Gunmen attacked a luxury hotel frequented by foreigners in Mali's capital Bamako early on Friday and are believed to be holding up to 170 hostages, a senior source with the security forces and witnesses said.
There are thought to be 140 guests and 30 employees in the hotel.
Local website Malikahere reports that a "dozen men screamed Allah Akbar at the time of the attack".
Local newspaper Jeune Afrique reports that three heavily-armed men entered hotel at 7am. The number of assailants and their reasons behind it remain unclear.
The U.S. Embassy in Mali asked citizens to shelter in place, suggesting there may be Americans present in the hotel.
The raid targeted the Radisson Blu hotel, located just west of the city centre in a neighbourhood that is home to government ministries and diplomats, they said.
Northern Mali was occupied by Islamist fighters, some with links to al Qaeda, for most of 2012. Although they were driven out by a French-led military operation, sporadic violence continues.
"Very early in the morning there was gunfire. Apparently it's an attempt to take hostages. The police are there and are sealing off the area," the security source said.
Witnesses in the area said police had surrounded the hotel and were blocking roads leading into the neighbourhood.
The U.S. 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 popular with foreigners.
Yesterday, Taoiseach Enda Kenny said Ireland was prepared to send additional Irish troops to Mali in order to relieve French soldiers who would be sent to relieve French forces to fight IS.
There are currently 10 members of the Irish Defence Forces in Mali and all are accounted for this morning, according to the Defence Forces.