Minister Ijaz-ul Haq said the militants were the bodyguards of the leader of the radical Red Mosque, Abdul Aziz, who was captured on Wednesday trying to flee the compound in a burqa.

"There are up to 30 armed terrorists holed up inside the mosque who do not want to come out and are preventing others from leaving the premises," he told state television.

Haq, the son of late military dictator Zia-ul-Haq, urged the men to surrender, saying they would be treated "in accordance with the law, with due respect".

Aziz earlier said there were around 1,000 students left in the mosque and urged them to surrender.

Islamabad administration chief Khalid Pervez also said male and female students were being held hostage by gunmen inside the mosque.

"They are using women and children as human shields," said Pervez, who is involved in the operation.