Fighters from the Islamist militant group Boko Haram have launched an attack on the key city of Maiduguri in north-eastern Nigeria, reports say.
Fierce fighting was reported on the outskirts. The military is carrying out air strikes, and a curfew is in place.
Maiduguri is home to tens of thousands of people who have fled Boko Haram attacks and was visited on Saturday by President Goodluck Jonathan.
Another Boko Haram attack was reported in Monguno, north of Maiduguri.
Boko Haram, which means "Western education is forbidden" in the Hausa language, launched military operations in 2009 to create an Islamic state.
Thousands of people have been killed, mostly in north-eastern Nigeria.
Separately, US Secretary of State John Kerry is scheduled to arrive in Lagos on Sunday.
'Pray for us'
Residents of Maiduguri, the capital of Borno state, say they woke to sustained loud explosions and gunshots. Roads and business have been closed by security forces
The attack appeared to have begun in the Njimtilo district on the edge of the city.
One resident there, Rachel Adamu, told Reuters: "Please pray for us, we are in danger, under serious attack now."
A resident of the Moronti area, Buba Kyari, told Agence France-Presse: "It is flying bullets everywhere. All we hear are sounds of guns and explosions. A rocket-propelled grenade hit and killed a person from my neighbourhood who was fleeing into the city."
The BBC's Chris Ewokor in Abuja says the military are carrying out co-ordinated air strikes and ground attacks against the insurgents.
Militants also reportedly attacked Monguno, 140km (86 miles) north of Maiduguri.
Security sources told Reuters the army there was being overwhelmed, with houses set on fire.
Maiduguri would be a major prize for Boko Haram, which last tried to take the city in December 2013.
President Jonathan visited Maiduguri on Saturday as part of his election campaign for polls in February.
It was his second visit in two weeks. Before these trips his last visit had been in March 2013.
On his visit on 16 January, he told some of the 5,000 refugees who fled recent Boko Haram violence: "I want to assure you that you will soon go back to your houses."
He pledged that "all the areas under the control of Boko Haram will soon be recaptured".
His visit came after UK-based human rights group Amnesty International released satellite images of towns attacked by Boko Haram, suggesting widespread destruction and a high death toll.
The pictures showed some 3,700 structures damaged or destroyed in Baga and neighbouring Doron Baga in the first week of the year, the human-rights group said.
Nigeria's government has disputed reports that as many as 2,000 were killed, putting the toll at just 150.
John Kerry is expected to meet both President Jonathan and rival presidential candidate Muhammadu Buhari on Sunday.
State department officials said Mr Kerry would urge them to appeal to supporters to refrain from violence in the lead-up to the election. Hundreds died after Mr Jonathan was elected in 2011.