The latest clash took place in the Sipah area of Bara Tehsil with Operation Khyber I (Khyber one) underway in the region. The operation was formally launched earlier this month.
Khyber I's main aim was to clear the areas lying from Bara Tehsil until the border of Tirah valley, following which a second phase of the operation would be launched, Dawn reported.
Security forces have intensified their efforts to counter militants in Khyber.
Scores of families have been moved to safer places as the offensive against militant groups is picking up.
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The plains of Bara hold strategic significance for militant groups as they connect the agency to the outskirts of Peshawar.
The area was being used by militants to put pressure on the provincial capital. In recent weeks, police and military posts in and around Peshawar have come under attack.
The key area also straddles the NATO supply line into Afghanistan.