Police sources said militants hurled a grenade at a security force party in Nowhatta area of the old city, and a policeman was killed and 10 Central Reserve Police Force troopers injured in the blast.
"The injured have been shifted to hospital for treatment," a source said.
The area has been cordoned off and searches started to locate the militants.
The attack has come on the day Prime Minister Narendra Modi visited the state to inaugurate the Nashri-Chenani tunnel on the Jammu-Srinagar highway.
Separatists had called for a shutdown to protest Modi's visit.
(This story has not been edited by Social News XYZ staff and is auto-generated from a syndicated feed.)
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Doraiah Chowdary Vundavally is a Software engineer at VTech . He is the news editor of SocialNews.XYZ and Freelance writer-contributes Telugu and English Columns on Films, Politics, and Gossips. He is the primary contributor for South Cinema Section of SocialNews.XYZ. His mission is to help to develop SocialNews.XYZ into a News website that has no bias or judgement towards any.