The Taliban claimed responsibility for the attack which occurred as the Afghan president's nominee for the crucial post of defence minister was to be introduced in parliament.
"Several mujahideen have entered the parliament building, heavy fighting is on going," Taliban spokesman Zabihullah Mujahid posted on Twitter.
"The attack happened at a time when the defence minister was being introduced," he added.
Officials could not immediately confirm whether Taliban fighters had breached the high-security parliament building and there were no immediate reports on casualties.
"We have heard reports of an explosion. We are heading to the scene," Kabul police spokesman Ebadullah Karimi told AFP.
The insurgents launched a countrywide offensive in late April, stepping up attacks on government and foreign targets in what is expected to be the bloodiest fighting season in a decade.
The militants recently rebuffed requests from senior Afghan clerics to halt attacks during the fasting month of Ramadan even as a surge in violence has sent civilian casualties soaring.
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