The attack in the eastern city of Jalalabad is the second major assault against an international organization in five days. Militants launched a similar operation against a U.N.-affiliated group in Kabul last week that killed three people.
Ahmad Zia Abdulzai, a spokesman for the governor of Nangarhar province, said Wednesday's attack in Jalalabad began just before dusk with a suicide blast at the entrance to the guest house compound belonging to the Red Cross.
"The initial reporting shows that two other people have entered the building," Abulzai said. "Right now a gun battle is going on between the Afghan security forces and the attackers. We have reports of one guard of the guest house being killed as a result of the attack. From the battle we have no reports of other casualties."
The Red Cross confirmed the attack but had no other details.
"We can confirm that there has been an attack on our offices in Jalalabad. We are working to find out the whereabouts and well-being of our colleagues," said Robin Waudo, communications coordinator for the Red Cross in Afghanistan.
An AP photographer at the scene said smoke can be seen rising from the vicinity of the guest house and the crackle of gunfire can be heard.
There was no immediate claim of responsibility, and it is unclear why insurgents would want to target the Red Cross, which not only carries out humanitarian work around Afghanistan but also is the conduit for families to communicate with detainees taken off the battlefield, including the Taliban.
The Red Cross warned last month that security was deteriorating across Afghanistan as militants flood the battlefield and conduct attacks in what could be the most important spring fighting season of the nearly 12-year-old war.
The violence comes just five days after Taliban gunmen backed by a suicide car bomber attacked the Kabul offices of the International Organization for Migration, killing two Afghan civilians and a police officer. The assault sparked an hours-long street battle and left another 17 wounded, including seven IOM staff members.
The IOM is a U.N.-affiliated agency assisting returning Afghan migrants as well as those displaced by fighting.
The Taliban quickly claimed responsibility for the attack on the IOM guest house in an upscale neighborhood of Kabul, a relatively uncommon operation by the group targeting an international aid group.
The Taliban and other militants have unleashed a wave of bombings and assassinations around the country, testing the ability of the Afghan security forces to respond with reduced help from international forces, who have begun a withdrawal that will see most foreign troops gone by the end of 2014.
This year is crucial for Afghanistan as the U.S.-led coalition is expected to hand over the lead for security in Afghanistan to the country's security forces sometime in the late spring. Foreign military forces are then expected to begin a massive withdrawal of forces that will culminate at the end of next year.
Earlier, seven insurgents wearing police uniforms and bomb-laden vests attacked a government compound in Panjshir, a usually secure province in eastern Afghanistan. One police officer was killed and another was wounded.
The Taliban, which claimed responsibility for the attack, has ramped up its assaults on government forces and officials since launching its spring fighting campaign earlier this month. While the attacks have grown more frequent in many parts of Afghanistan, Wednesday's violence was of note because it took place in in eastern Panjshir province, a normally peaceful area in a valley that was the heart of the anti-Taliban resistance until the U.S. invasion in late 2001.
Governor Kramuddin Karim said the attackers targeted the government complex in the provincial capital of Bazarak, and that all seven militants were killed.
Taliban spokesman Qari Yousef Ahmadi claimed responsibility for the attack in an email to journalists.
Provincial police chief Qasim Jangalbagh said the insurgents were wearing police uniforms, and that three of the attackers blew themselves up and four were killed by police during the assault. The government complex was empty because of the early hour, Jangalbagh said.
Jangalbagh said a station wagon with 20 kilograms (44 pounds) of explosives that the insurgents were driving did not blow up. He added that one of the seven insurgents managed to flee the scene, but later blew himself up.
Associated Press writers Rahmat Gul in Jalalabad, Afghanistan, and Patrick Quinn in Kabul, Afghanistan, contributed to this report.
Copyright 2013 The Associated Press.