A group of gunmen wearing explosives-laden jackets and armed with hand-propelled grenades, mortars, AK-47 rifles attacked a guard post as they tried to fight their way into the Badaber air base 6 kilometres outside Peshawar, the capital of Khyber Pakhtunkhwa province.
An army captain was among 20 people killed in the attack on the Pakistan Air Force (PAF) base and a mosque inside it, officials said.
All 13 terrorists were killed by security forces, military spokesman Major General Asim Bajwa tweeted.
Several of those killed were offering prayers at the mosque, Bajwa said adding that the terrorists were dressed in constabulary uniforms.
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Terrorists entered the base at two points, splitting into sub-groups, sparking a fierce gunbattle with security forces, he said.
At least 22 people, including eight soldiers and two senior army officers, were injured in the attack.
The injured have been shifted to a military hospital in Peshawar and two have been taken to Lady Reading Hospital (LRH). An emergency has been declared in both hospitals.
"Our suicidal unit carried out the attack," TTP spokesman Muhammad Khurasani said in an email statement.
Khurasani claimed that 80 security personnel were surrounded by the militants and 50 of them killed but it was not confirmed. He also claimed that women and children were given safe exit which was also not confirmed.
Bajwa said security forces reached the area shortly after and sealed it off but a gun battle is still underway.
"Clearance ops still underway. Searching for hidden terrorists," Bajwa tweeted.
Eyewitnesses claim they saw terrorists dressed in black militia uniforms and wearing white shoes. Nearby residents said explosions and gunfire could still be heard hours after the attack took place.
Army chief General Raheel Sharif has arrived in Peshawar and visited the wounded in hospital.
Prime Minister Nawaz Sharif condemned the attack and said, "Terrorists will be rooted out from the country".
The Badaber air base is not functional and is mostly used as a residential place for the employees and officers of the air force.