The day-time raid in North Darfur's capital of El-Fasher came as the government continues to claim that the conflict in Darfur -- a huge region the size of France -- has ended.
The attack in an eastern district of the town that also houses several government buildings came weeks after gunmen in military uniforms killed eight people in the mountainous Jebal Marra area of Darfur.
Gunmen in several vehicles stormed the market and began firing and looting shops, a resident told AFP.
"There is fear and panic among the people and schoolchildren in the area. They are fleeing," he said on condition of anonymity.
The office of El-Fasher's governor confirmed the attack.
"There is an exchange of fire now between security forces and criminals," it said in a statement.
Conflict erupted in Darfur in 2003 when ethnic minority rebels took up arms against President Omar al-Bashir's Arab-dominated government, accusing it of marginalising the region.
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