Police and military officers are on high alert in Mandera Town following a dawn attack at Balad Hawo Somali military camp.
Al Shabaab hit the camp which is located just four Kilometers away from the town.
The group also said 24 Somali soldiers were killed in the raid, but a Somali military official put the figure at around 10 dead soldiers.
The officers are on standby to avert a spillover from the fighting that started at 5 am.
Northeastern regional coordinator Mohamud Saleh said the militants want to take over the base.
Locals on Monday morning said they could hear explosions and gunshots from the Somalia side.
Al Shabaab, which wants to impose its strict interpretation of Islam in Somalia, has carried out frequent past attacks in Mogadishu and elsewhere in its bid to topple the Western-backed government and drive out African Union peacekeeping troops.
“We were awoken by a suicide car bomb this morning and then fierce battle followed,” Major Mohamed Abdullahi told Reuters from the town.
“We lost at least 10 soldiers. We chased al Shabaab out of the town. We killed seven militants.”
The death toll on both sides could still rise, however, he added.
Residents said the fighting was continuing.