At least seven Turkish soldiers have been killed and 15 wounded in an ambush by Kurdish rebels, state TV says.
The attack took place in Yuksekova, near the border with Iraq and Iran. Ground troops and combat helicopters are pursuing the assailants.
Several thousand Kurdistan Workers Party (PKK) rebels are believed to be based in mountain hideouts in northern Iraq.
Tens of thousands of people have died since the PKK took up arms in 1984.
Security sources told Reuters that the rebels had crossed the border to carry out the attack on an army post, and had then retreated back to Iraq.
Clashes between the PKK and the Turkish armed forces have increased in south-eastern Turkey over the past year, and the PKK has in the past carried out bombings in other parts of the country.
A powerful bomb in Ankara in September last year killed three people and wounded 15.