Heavy gunfire broke out at the headquarters of the paramilitary Bangladesh Rifles (BDR) in Dhaka on Wednesday, and at least one person was killed and six others wounded, a doctor told Reuters.
Bangladesh, an impoverished South Asian country of more than 140 million, has seen a number of successful and failed military coups in its history, but the factors behind Wednesday's incident were not immediately clear.
Witnesses said army troops entered the BDR headquarters and also took up positions in nearby areas as a military helicopter hovered overhead.
A doctor at Dhaka Medical College Hospital said it had received one civilian dead from the fighting and six people wounded, including one BDR member.
Flames rose from the complex and big blasts were heard.
"They are firing rifles, machineguns, artillery and all sorts of weapons," one police officer near the scene said.
Private television said scores of civilians were injured by stray bullets on the streets as they ran for cover. The BDR complex also houses a school where many students have been confined, anxious guardians told reporters.
"There may be casualties within the complex," one police officer said, "But we don't have any confirmation or details."
The defence ministry's media wing issued an appeal to the violent soldiers to put down their guns.
"Please end the indiscipline and violent activities immediately, drop your guns and return to the barracks," it said.
"Prime Minister (Sheikh Hasina) will herself listen to your demands and meet them as much possible," it added, without saying what the demands are.
"You please resume order and end violence. Otherwise you will face (punitive) actions," it added.
"The shooting started in the BDR headquarters in the city's Pilkhana area around late morning and hundreds of shots were heard from areas around it," a resident told Reuters by telephone.
Traffic came to a halt on nearby streets and panic spread across the capital as private televisions reported the gunfire.
Sources said the gunfire started while BDR officers and soldiers were holding a meeting, but no details were known.
"We cannot really get close to the scene but saw army troops crawling towards the headquarters and urging people" to leave the area and stay calm, a Reuters television cameraman said.
Prime Minister Hasina's party won election in December and took over from a military-backed interim government, with hopes high the country, with a long record of political violence, was moving toward democracy and stability.