• The Nato-led peacekeeping force in Kosovo says it has troops in the area and is ready to respond if required.
• EU-mediated political talks designed to stabilise the situation have stalled.
Security forces have surrounded at least 30 armed gunmen hours after a police officer was shot dead in Kosovo, the country's prime minister says.
Albin Kurti said the group was in a monastery in the northern village of Banjska and urged them to surrender.
Mr Kurti has accused Serbia of backing what he called a "terrorist attack" that also injured another officer.
The Nato-led peacekeeping force in Kosovo says it has troops in the area and is ready to respond if required.
Tensions have run high in Kosovo, after violent clashes followed a disputed local election in May.
EU-mediated political talks designed to stabilise the situation have stalled.
Kosovo declared independence in 2008 but Serbia - along with Belgrade's key allies China and Russia - does not recognise it.
Many Serbs consider it the birthplace of their nation. But of the 1.8 million people living in Kosovo, 92% are ethnic Albanians and only 6% are ethnic Serbs.
Sunday's shooting happened at about 03:00 (01:00 GMT), after police said they arrived in Banjska, near the border with Serbia, where a blockade had been reported.
Officers were attacked from several different positions with "an arsenal of firearms, including hand grenades and shoulder-fired missiles", they said in a statement.
"We can see armed people in uniforms...they are firing on us and we are firing back," Kosovo police official Veton Elshan told AFP news agency by phone from Banjska.
The Serbia Orthodox Church said that gunmen had stormed a monastery in the village, located in Leposavic, where pilgrims from the northern Serbian city of Novi Sad were staying.
Priests and pilgrims locked themselves inside the monastery's temple for safety, the Diocese of Raska-Prizren said, adding that gunfire was occasionally heard.
The prime minister accused organised criminals with political, financial and logistical support from Belgrade of "attacking our country".
Mr Kurti added that the perpetrators and those who issued their orders would be punished.
Kosovo's President Vjosa Osmani said the incident, "orchestrated by Serbian criminal gangs", was an attack on law and order and "against the sovereignty of the Republic of Kosovo".
She condemned the "open aggression of Serbia towards Kosovo" and called on the country's allies to support Kosovo in establishing law and order.
Ms Osmani urged people to remain united and expressed her confidence in Kosovo's police.
Serbia has not commented on the incident.
Nato peacekeepers are "ready to respond if required" in north Kosovo and were "working intensively to find a solution" to the unrest, KFOR said.
The European Union's foreign policy chief Josep Borrell condemned what he called the "hideous attack" and said those responsible must be brought to justice.
It comes after the latest EU-mediated talks collapsed last week, with Mr Borrell blaming Mr Kurti for failing to set up the association of Serb-majority municipalities which would give them more autonomy.
Unrest engulfed northern Kosovo in May after Kosovo Albanian mayors were installed in majority-Serb areas, after Serb residents boycotted local polls.
Nato deployed an additional 700 troops to Kosovo to deal with unrest in the northern town Zvecan following the elections.
Some 30 Nato peacekeepers and more than 50 Serb protesters were hurt in the ensuing clashes.