Gunmen attacked a former United Nations office in a diplomatic quarter of Damascus late Tuesday, setting off a battle with police that pelted nearby buildings with bullets and grenades. The government said two attackers, a policeman and a civilian were killed.

Syria has not seen such violence since the 1980s, when the government put down an insurgency by Islamic militants.

The vacant building was formerly occupied by the U.N. Disengagement Observer Force (search), which oversees an agreement between Israeli and Syrian forces in the Golan Heights (search). It was extensively damaged by fire during the gunbattle.

"Unidentified terrorists attacked a U.N. office building in Damascus and this office is surrounded by many embassies as well," Syria's ambassador to Washington, Imad Moustapha, said in a telephone interview from Washington.

Moustapha said it was too early to know the motivation of the attackers or whether they were Islamic.

"There was a random exchange of fire and probably every building in that area was hit by a grenade or a bullet" before security forces surrounded the area and returned fire, he said.

Syria's official news agency SANA, quoting a security source, called the attackers "a terrorist band."

The Al-Arabiya television network said there were four attackers. It said three were killed and one wounded. The report could not be immediately confirmed.

Hours later, Sana reported that authorities raided a "terrorist hideout" in the nearby town of Khan al-Sheih and recovered a variety of weapons belonging to the attackers. The arms, which including rocket propelled grenades, guns and ammunition, were shown on Syrian Television.

After the gunbattle, large crowds gathered to catch a glimpse of the damaged building. Youths drove by honking car horns, waving pictures of Syrian President Bashar Assad (search) and chanting pro-Syrian and pro-Assad slogans.

In Washington, an administration official said the State Department has received reports of two explosions and of small arms fire in the Syrian capital. The official, asking not to be identified, said there were no reports of American casualties.

She added that the embassy expects to be closed on Wednesday along with the school in Damascus that serves the American community.

In New York, Marie Okabe, a U.N. spokeswoman, said all U.N. staff and facilities were safe and accounted for. U.N. officials said that U.N. offices in the capital planned to remain closed Wednesday.

The U.N. headquarters in Baghdad, the capital of neighboring Iraq, was bombed twice after the U.S.-led war last year. The first, on Aug. 19, killed 22 people including top U.N. envoy Sergio Vieira de Mello (search).

Witnesses, who said the violence started about 7:20 p.m. and lasted 70 minutes, gave different reports that could not immediately be reconciled.

One witness said four gunmen came out of a white van on the main Mazza Boulevard in front of the Canadian Embassy and started shooting indiscriminately. A police car on patrol in the area rushed to the scene and came under fire. The police shot back and police and plainclothes security forces reinforcements arrived, the witness said.

Three gunmen were killed and a fourth was taken into custody, the witness reported. Five cars were gutted and there was a fire at the building where the United Nations used to have offices. Police explosives experts were brought to the scene to examine the bodies of the dead gunmen to make sure they were not booby-trapped.

Another witness said the attackers were riding in two cars. Two explosions were first heard and a heavy exchange of fire ensued. More than 15 explosions followed, said the witness.

Late into the evening, smoke was seen billowing from Mazza and ambulances and police cars rushed to the area, which had been sealed off by security forces.

SANA later released a photograph of the mangled wreck of the car, apparently the one which the bomb was placed under, being removed from the scene by a truck.

Syrian political analyst Imad Shuaibi told The Associated Press he had learned that two men "attacked with hand grenades and gunfire near the Iranian and Canadian embassies."

Mazza, on the western edge of Damascus, is home to the British ambassador's home, offices of the Iranian state news agency, the Iranian Embassy and the Canadian Embassy are in Mazza.

British and Iranian diplomatic officials said their embassies were not targeted in the attack.

Syria has been on the U.S. State Department's list of terror-sponsoring nations for its support of groups like Hamas (search) and Hezbollah (search) that attack Israel. Syria, though, says the anti-Israeli groups are not terrorist, and that it has an interest in fighting Islamic extremist groups like Al Qaeda.

During the late 1970s and early 1980s, Syria's hard-line government fought a fierce war with Islamic fundamentalists of the Muslim Brotherhood (search), which was blamed for a 1980 assassination attempt on President Hafez Assad (search), the country's authoritarian leader who died from natural causes in 2000. Assad was succeeded by his son, Bashar Assad.

In 1982, the Muslim Brotherhood staged a rebellion in the northern province of Hama. During the clashes, Syrian forces razed much of the city, killing as many as 10,000 people and finally crushing the Brotherhood after a five-year war.