In what has been seen repeatedly in the past, both Pakistani and Indian military accused each other for starting an "unprovoked" firing across the de facto border leading to casualties on both sides.
Six civilians, including a husband and wife and a soldier, were killed after Indian and Pakistani soldiers targeted border posts and villages along the highly militarised frontier in India-administered Kashmir, officials said on Friday.
The cross-border firing and shelling began overnight and spread to dozens of posts in the Jammu region of the disputed Himalayan territory, said Indian police officer S D Singh.
Indian paramilitary officials said their soldiers responded to Pakistani gunfire and shelling, describing it as "unprovoked and indiscriminate."
The officials said the paramilitary soldier was killed by a Pakistani sniper on Thursday night, leading to cross-border firing and shelling at several forward posts.
The husband and wife were killed in India-administered Kashmir. At least seven civilians were also wounded and were being treated in hospitals.
Pakistan military accuses India
In Pakistan, the military accused Indian troops of initiating "unprovoked" violation of the 2003 ceasefire accord between the two countries along the frontier near Kashmir and targeting the civilian population including four villagers who died on Friday morning.
In a statement, the military said that Indian fire also wounded 10 people, including three children, in the border village near the city of Sialkot, bordering Kashmir.
It said Pakistani troops "effectively" responded and targeted the Indian posts from where the fire came.
The military said the artillery exchange was continuing.
As was the case in the past, each country has accused the other of initiating border skirmishes leading to casualties on both sides.
This year, soldiers from the two nations have engaged in fierce border skirmishes along the rugged de facto border Line of Control, as well as a lower-altitude 200-kilometre boundary separating India-administered Kashmir and the Pakistani province of Punjab, where Friday's fighting occurred.
Singh, the Indian officer, said authorities were evacuating civilians living near the frontier in armoured vehicles. The fighting earlier this year also sent thousands of border residents to temporary shelters for days.
India and Pakistan have a long history of bitter relations over Kashmir, claimed by both in its entirety. They have fought two of their three wars since 1947 over their competing claims to the region.
The fighting has become a predictable cycle of violence as the region convulses with decades-old animosities between India and Pakistan over Kashmir, where majority Muslim population and rebel groups demand that the territory be united either under Pakistani rule or as an independent country in a UN-brokered plebiscite.
India accuses Pakistan of arming and training anti-India rebels and also helping them by providing gunfire as cover for incursions into India-administered Kashmir.
Pakistan denies this, saying it offers only moral and diplomatic support to the rebels and to Kashmiris who oppose Indian rule.
Nearly 100,000 people have been killed in the uprising and the ensuing Indian military crackdown since 1989.