Updated 3.05pm

18 people are said to have been killed after gunmen stormed a luxury hotel in Kabul.

Several heavily-armed attackers burst into the five-star Intercontinental Hotel in the Afghan capital, taking around 100 people hostage as frantic guests tried to escape through windows several floors up.

Some were trapped on balconies at the top of the six-storey building and used bedsheets to climb down and escape.

Afghanistan's Interior Ministry said 18 people - 14 foreigners and four Afghans - were killed in the assault by several insurgents who stormed the hotel using guns and hand grenades on Saturday evening.

Ministry spokesman Najib Danish said that 11 of the 14 foreigners killed were employees of Kam Air, a private Afghan airline.

Around 100 people were taken hostage and the siege ended after 12 hours when the last attacker was killed in a gun battle with Afghan security forces.

More than 150 people, including 41 foreigners, were rescued from the hotel. Six members of the police and special forces were injured, along with four civilians.

Witnesses said some areas of the building looked like a butcher's shop with blood everywhere.

They said gunmen shot at people who were having dinner in one of the hotel restaurants before breaking into guests' rooms and taking dozens of hostages.

Several people managed to escape to the hotel's outdoor pool area where they hid, listening to the attack unfold just metres away.

"I could repeatedly hear blasts"

Photo taken on Jan. 21, 2018 shows a gate of Intercontinental Hotel in Kabul, Afghanistan

One guest, Aziz Tayeb, who hid behind a pillar, said: "I saw people who were enjoying themselves a second ago screaming and fleeing like crazy, and some of them falling down, hit by bullets.

"I could repeatedly hear blasts one after another, hand grenades, they used many grenades.

"We contacted security officials who arrived an hour later and as we were being escorted out I saw five or six bodies outside the hotel.

"The second, third and fifth floors were on fire - the fifth floor was engulfed in flames."

The Taliban has claimed it carried out the hotel atrocity, saying five gunmen armed with suicide vests targeted foreigners and Afghan officials.

The Intercontinental Hotel was previously attacked by Taliban fighters in 2011 when 21 people were killed, including 10 civilians.

The US embassy in Kabul had issued a warning to American citizens on Thursday, saying: "We are aware of reports that extremist groups may be planning an attack against hotels in Kabul."

More than 100 IT managers and engineers were at the Intercontinental ahead of a conference when Saturday's attack took place.

Security has been tightened in the city since a truck bomber killed at least 150 people outside the German embassy in May.