At least seven loud explosions shook the usually secure diplomatic neighbourhood accompanied by waves of automatic gunfire over about five hours.
The US embassy blared out warnings for staff to take cover as insurgents struck from a high-rise building being constructed a few hundred metres from the embassy and International Security Assistance Force (ISAF) headquarters.
Seven hours after the attacks started, Afghan and coalition forces were still trying to clear the site of insurgents, three of whom have already been killed. Officials say a couple remain inside.
The attacks again highlighted poor security in Kabul, where insurgents have staged a string of increasingly brazen commando-style raids on Western and Afghan targets in recent months.
Interior ministry spokesman Siddiq Siddiqui said four civilians and three police had been killed in the attack and three coordinated, smaller incidents, while 10 civilians and nine police were hurt.
A journalist from Afghan state broadcaster RTA was also shot and wounded while covering the standoff, an AFP reporter at the scene said.
US embassy spokeswoman Kerri Hannan said that there no deaths or injuries among the hundreds of staff there.
But in a later statement the embassy confirmed the attack involved “RPGs (rocket propelled grenades) and small arms fire” and that four Afghans had been injured – three who were applying for visas and a local security guard.
Secretary of State Hillary Clinton vowed that the Americans who work at the embassy would not be put off by such attacks.
“They will not be intimidated by this kind of cowardly attack,” she said.
“We will take all necessary steps not only to ensure the safety of our people but to secure the area and to ensure that those who perpetrated this attack are dealt with.”
The giant, high security US embassy compound borders the ISAF compound where thousands of foreign troops live and work.
ISAF spokesman Lieutenant Colonel Jimmie Cummings said that there had been no casualties among its personnel, who are trying to support the Afghan government in efforts to reverse Taliban momentum.
“We have a few rounds from small arms and some indirect fire that landed in our compound,” Cummings said. “There was minor damage but no casualties.”
AFP reporters heard a string of loud blasts shortly after 1:30 pm (0900 GMT) just two days after the United States marked the 10-year anniversary of the 9/11 attacks that triggered the long war in Afghanistan.
Last month, nine people died when suicide bombers attacked the British Council cultural body in Kabul.
In June, Taliban militants also stormed the luxury Intercontinental Hotel in Kabul, sparking a fierce battle that left at least 12 people dead.
The US military has blamed some of the worst attacks in Kabul on the Al-Qaeda-linked Haqqani network, whose leadership is based in neighbouring Pakistan and enjoys the protection of Pakistani intelligence agents. – AFP