It was not immediately clear what sparked and who was behind the violence, but the region has been hit by recent communal violence between Christians and Muslims, and is also an area where an Islamist rebel group is known to operate.
"So far 54 of the attackers have been put out of action, and 40 of their colleagues have been captured and are in custody, effectively bringing sanity to the region," said a regional army spokesman, Ninsiima Rwemijuma.
Police spokesman Fred Enanga said the overall toll from the clashes on Saturday and security sweep on Sunday stood at 65 dead, with several civilians and soldiers among the casualties.
The violence occurred in the areas of Kasese and Bundibugyo, close to the Rwenzori mountains which straddle the border between Uganda and DR Congo.
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"We urge the public not to panic as the situation is getting back to normal and there is enough deployment by the army and police," he added.
The clashes came hours after the army announced it had killed a person suspected of involvement in an attack by Muslims on a church in the border region two weeks ago, during which a woman was decapitated by the attackers and her head placed on the altar.
Both the army and police denied the attacks were related to any rebel group, instead blaming local tribal and communal tensions.
"There was an attack by tribal gunmen on our barracks in Bundibugyo and we repulsed them," Uganda's army spokesman, Paddy Ankunda, told AFP. "It is an ugly situation but we have brought the situation under control."
The Kasese and Bundibugyo attacks are linked to tribal differences, not the ADF," Ankunda said, referring to the Allied Democratic Forces, an Islamist rebel group fighting the Ugandan government and based in the DR Congo border region.
On Tuesday the UN Security Council decided to slap sanctions on the ADF, which is accused of recruiting child soldiers, sexual abuse of women and children and attacks on peacekeepers in DR Congo's eastern Kivu region, home to myriad rebel groups.