The militants had entered the Delhi Public School located close to the Srinagar-Jammu National Highway last evening after attacking a CRPF party in the nearby Pantha Chowk, killing one officer and injuring a constable.
The road opening party of the CRPF was attacked in high security zone located less than a kilometre away from the headquarter of the Srinagar-based Army Corps.
Immediately thereafter, the security forces cordoned off the school premises which has seven buildings, comprising 36 rooms, and the staff and others were evacuated last night itself.
"The exchange of fire between security forces and militants began at around 3.40 am," he said.
"The gunbattle is over and two militants have been killed," the official said this evening after over 14-hour armed engagement.
He said the search and sanitization operation was, however, underway at the encounter site.
Two Army personnel were injured in the gunbattle this morning, the official said. He said the injured have been taken to a hospital.
Earlier, Jammu and Kashmir's Director General of Police S P Vaid had said that there were reports of the presence of two militants inside the building but the exact number would be known after the search of the complex was over.
He said the security forces wanted to ensure that the (school) building was safe.
"The enemy has a nefarious design that the school buildings are destroyed and children have nothing to study and ultimately abandon their studies, which we will ensure that no such thing happens," the state police chief said.
He was speaking to the media on the sidelines of wreath laying ceremony of CRPF officer killed in yesterday's attack.
The authorities had imposed restrictions under section 144 CrPc from Ram Munshibagh to Sempora stretch of the national highway as a precautionary measure to avoid protests near the encounter site.
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