Two of the killed militants were locals while one was yet to be identified, the police said.
The gunbattle took place after security forces launched an operation following information about the presence of militants in Amargarh area of Sopore in Baramulla district, a police official said.
As the security forces were closing in, the militants opened fire, which was returned, the official said.
Two slain militants were identified as Javid Ahmed Dar of Baramulla and Abid Hamid Mir of Bandipora, the police said.
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Meanwhile, three persons were injured in Bandipora district when Army personnel allegedly opened fire on a group of stone-pelters who targeted them,police said.
A mob pelted stones on Army vehicles which were passing through S K Bala locality in Sumbal area of Bandipora this morning, a police official said.
He said the Army personnel allegedly opened fire to disperse the mob, resulting in injuries to three persons.
The injured have been referred to a hospital here for treatment,he added.
A similar incident took place at Harnag in Anantnag district but there were no injuries there,the official said.