Two soldiers and four gunmen have been killed in an overnight attack on Indian air force base Pathankot near Pakistani border, officials say.
Operations at the base are continuing, with some reports saying gunmen are holed up in the base.
The incident came days after the Indian and Pakistani leaders Narendra Modi and Nawaz Sharif met in Lahore to launch a surprise peace initiative.
The whole of India’s Punjab state has been placed on alert.
The Pathankot base is on the main highway leading to Indian-administered Kashmir.
The gunmen wore Indian military uniforms and drove a hijacked car when they launched the attack at 03:30 local time.
They entered living quarters at the base, but were contained there and so were unable to cause any damage to military hardware, said air force spokeswoman Rochelle D’Silva.
On January 2, fresh gunfire was heard and a helicopter seen firing at an area inside the base.
It is not yet clear who the attackers were but suspicion is already falling on Kashmiri militant groups based in Pakistan.
Some Indian security officials suggested the Islamist militant group Jaish-e-Mohammed was to blame.
India says the group is backed by Pakistan, but Islamabad denies this.
Pathankot air force base is about 270 miles north of the Indian capital, Delhi and is on the road linking Indian-administered Kashmir with the rest of the country.
Indian-administered Kashmir has seen a long-running insurgency against rule from Delhi, and Kashmir has been a flashpoint in relations between Pakistan and India for nearly 70 years since independence.