Two militants were killed in a fierce gun battle that broke out on Thursday morning between security forces and Lashkar-e-Toiba militants in south Kashmir's Padgampora area of Pulwama district.

"The slain militants have been identified as Jehangir Ganai and Mohammad Shafi alias Sher Gujri," a senior CRPF officer said, adding that Ganai was involved in the killing of a local policeman last year.

"Both militants are resident of Koel village of the district (Pulwama)," the officer said.

Security forces from the CRPF and Special Operation Group (SOG) of Jammu and Kashmir police have started search operations and cordoned off the area where two-three militants of the group were holed up.

The Army was deployed in the area to carry out combing operations.

"Two heavily armed terrorists are believed to be trapped in a house. Troops of 130 Battalion CRPF, 55 Rashtriya Rifles and SOG Pulwama are involved in the operations," police said.

Locals said gunshots were heard after security forces have sealed all the entry and exit points.

Meanwhile, the Bannihal-Baramulla train service has been suspended as the railway track moves close to encounter site in Padgampora village.

This is the second major encounter in the area in last four days. Last week, top Hizbul Mujahideen militant Aqib Maulvi was killed along with a Pakistan based Jaish-e-Mohammed militant Osama in Tral area of Pulwama district.