Afghan security forces are back in control of the strategic northern city of Kunduz, Nato forces and local police say.
Taliban fighters earlier appeared to have breached the city, reportedly raising their flag in a central square.
In a major victory, Kunduz was briefly captured by the Taliban in September 2015 but government forces, backed by Nato, recaptured it within days.
Special forces have been flown in from Kabul to help repel the latest assault.
"The city centre is now in our hands and not in their hands. We are launching an attack to clean up the area," Kunduz police chief Kassim Jangal Bagh told the AFP __news agency.
The Nato-led Resolute Support mission said Afghan security forces were in control of the city and its main square "with additional troops coming".
Fighting is continuing near the city's police headquarters, governor's compound and National Directorate of Security headquarters, Reuters __news agency reports, citing officials.
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Taliban spokesman Zabihullah Mujahid said via his official Twitter account: "A massive operation started on Kunduz capital from four directions early this morning."
The Taliban later said they had seized the roundabout and several checkpoints, but did not claim to have captured the city.
The Pentagon has suggested the assault was less serious than it may have appeared.
"We see the Taliban go into these city centres, do a Western-movie style shoot-them-up, do some raiding, do some looting, raise a flag, and just as quickly as they do that, they are beaten right back out again," spokesman Jeff Davis said.
According to Afghanistan's interior ministry, at least one policeman was killed and four wounded in Monday's fighting, AP reports.
The fighting comes a day before a major donors' conference in Brussels and highlights the precarious security situation after Nato pulled out combat forces.
In southern Helmand province, militants also took a strategically important district to the south of Lashkar Gah, killing the local police chief, officials said earlier on Monday.
A number of other police casualties were also reported.
The capture of Kunduz by the Taliban last September was a huge blow to the country's Western-backed government. The militants abandoned the city after four days but they had proved their growing capability by taking their first major city,
The group raided Tarin Kot, the provincial capital of Uruzgan, last month.
Afghan government forces are estimated to have control over no more than two-thirds of Afghanistan.
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