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Two militants and an army jawan were killed in a fierce gunbattle between security forces and Ultras in a forest area of Jammu and Kashmir's Poonch district on Saturday.
A jawan was also wounded in the firefight, which was still continuing at Dhandot-Kanga Gali, nearly 180 km from Jammu, official sources said.
Some four to five militants were still hiding in the area, they said adding the exchange of fire began at around 4 pm.
The encounter took place after security forces launched a search operation following firing by Pakistani troops in the area on Friday evening.
The firing from across the border was apparently aimed at pushing infiltrators into the Indian territory, sources said.