At least ten people are reportedly being held hostage at a Christian church in the Iraqi capital.
It follows an attack by gunmen on the building in central Baghdad. Three bombs were detonated before fighting broking out with security forces.
One local television station says it is received a call from one of the alleged attackers who demanded the release of all al Qaeda prisoners in Iraq and Egypt.
Some police sources say two security guards were killed in the attack which began near the Assyrian Catholic church.
They also believe the initial target was the nearby Iraqi stock exchange.