Police also fired teargas shells and smashed down one of the doors of the mosque, but have not yet entered, a senior security official near the scene told AFP on condition of anonymity.

"They were explosive charges. This was another warning," the official said.

"There has been firing from inside also and two or three hand grenades were thrown from inside the mosque, which also blew up, without causing any casualties," he added.

The blasts were heard across the city and alarmed residents more than two miles (nearly four kilometers ) away from the mosque.

"The large explosions were us and the smaller ones were the grenades," the official said.

"Announcements are being made now. We want them (the students) to surrender peacefully."

State television said the students in the mosque were being told over loudspeakers to lay down their arms "or you will be responsible for any losses."

The official said armored personnel carriers were brought up to the wall of the mosque.

The gunfire stopped after several minutes because of the call to dawn prayers.

The area has been under a shoot-on-sight curfew for around 24 hours.

Late Wednesday the leader of the mosque, Abdul Aziz, was captured while trying to flee the mosque dressed in a woman's burqa, but his brother and around 200 followers remained inside.