The gunmen invaded Owutu-Ishawo in Ikorodu early on Sunday and kidnapped residents after looting their homes and shops.
"Around 1:00am on Sunday, the police received a distress call that a group of militants and kidnappers had entered Owutu-Ishawo in Ikorodu through the thick swampy forest surrounding the area," Lagos police spokesman Olarinde Famous-Cole told AFP.
"They were reported to have kidnapped some residents. In response, the police and the army immediately mobilised personnel to the area where the kidnapped victims were rescued," he said.
Famous-Cole said police were combing the surrounding forests and creeks in search of the attackers.
Despite security generally improving in Lagos in recent years, hard economic conditions still force some people to turn to crime.
Last October, four students and two teachers were abducted from a school in Epe by gunmen in speed boats, prompting the government to demolish waterfront shanties in a bid to flush out the criminals.
In one such demolition, some 30,000 residents of Otodo- Gbame, near the upscale Lekki district, were made homeless, angering rights groups including Amnesty International.
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