The deadly fight involving militants from the Party of Free Life of Kurdistan (PJAK) took place on Monday in the city of Orumieh in the province of West Azarbaijan.

"A terrorist team from PJAK entered the city of Orumieh to kill some of our citizens, but it was identified and crushed," ISNA quoted a statement from the intelligence ministry as saying.

"In this operation on Monday, a terrorist was arrested and two others who were Turkish nationals were killed."

In another incident on Saturday, Kurdish rebels killed four Iranian policemen in a raid on a police station near Orumieh.

Western Iran, which has a sizeable Kurdish population, has seen deadly fighting in recent years between Iranian security forces and PJAK rebels operating from rear-bases in neighbouring Iraq.

The group is closely allied with the Turkish Kurdish rebel group, the Kurdistan Workers' Party (PKK), which is listed as a terrorist group by Ankara and much of the international community.

Iraq, Iran, Syria and Turkey all have significant ethnic Kurdish minorities.