Officials say that at least four soldiers have been killed in a border skirmish between Azerbaijan and Armenian troops.
Azerbaijan's Defense Ministry said one of its troops had been killed in combat.
The group "was ambushed as it attempted to violate the Azerbaijani state border," the defense ministry also reported in a statement.
"The enemy suffered heavy losses and was forced to retreat," the Azerbaijani release also stressed.
Baku also said Thursday that Azerbaijani troops shot down an Armenian drone which crossed the line of contact between the two countries' forces.
The Armenian aerial vehicle patrolling over Azerbaijani positions was destroyed through a special method on Thursday, the statement read.
The incident happened in Azerbaijan's Terter region on the conflict frontline between Azerbaijani and Armenian troops.
"In the early hours of Thursday morning, Azerbaijani armed forces attempted a subversive intrusion into Armenian territory," Armenian defense ministry spokesman Artsrun Hovhannisyan said.
"Three Armenian troops were killed" in the shootout near the Armenian village of Chinari, he said, adding that "fighting continues, with both sides using grenade launchers and sniper rifles."
Baku, for its part, accused Armenia of sending a "subversive group" to Azerbaijan.
Ex-Soviet Azerbaijan and Armenia have feuded over the Nagorno Karabakh region since Armenian separatists seized the territory in a war that claimed some 30,000 lives in the early 1990s.
The two sides never signed a firm peace deal despite a 1994 truce and have regularly exchanged fire across their shared border and along the frontline.
A Russian-brokered ceasefire ended the four days of fierce fighting in April but attempts to relaunch the stalled peace process since then have failed.
Since the end of war in 1994, Armenia and Azerbaijan have held talks under the supervision of the Organization for Security and Co-operation in Europe's Minsk Group.
An agreement-in-principle was reached in St. Petersburg, Russia, following talks late June involving Azerbaijani President Ilham Aliyev, Russian President Vladimir Putin and Armenian President Serzh Sargsyan.
This April, according to the Azerbaijani Defense Ministry, more than 270 military personnel were killed in the worst breach of a 1994 treaty between the sides.
Three UN Security Council Resolutions (853, 874 and 884), and United Nations General Assembly Resolutions 19/13 and 57/298 refer to Karabakh as being part of Azerbaijan.
The Parliamentary Assembly of the Council of Europe refers to the region as being occupied by Armenian forces.