The advisory came after Pakistani officials evacuated more than 50 Chinese nationals working on a dam being constructed in Kashmir along the confluence of the Neelum and Jhelum rivers.
Authorities moved the workers last Tuesday after the firing killed four civilians -- including a four-year-old boy -- and critically injured 11 others, authorities said.
Pakistan on Sunday accused India of using cluster bombs against civilians in the same area, in Noseri sector.
India abolishes occupied Kashmir special status with rushed decree
Authorities later asked the villagers through social media and WhatsApp messages to remain alert and not to approach any suspicious object as the "enemy was using toy bombs, mortar shells and artillery."
Local authorities later took a group of reporters to the Noseri area, on the LOC where Badr Munir, a senior government official, briefed them on the escalation.
"Four people have been martyred and 11 others wounded by cluster bombs in two different incidents," Munir said.
An AFP reporter at the scene saw that the Noseri Bazaar appeared deserted, with shops closed and less traffic than usual on the roads.
Authorities also showed two unexploded cluster bombs to reporters. The site was cordoned off by police to prevent people from getting closer to avoid any further damage.
Munir said a group of experts along with police was searching for more unexploded bombs in the area.
Muhammad Siddique, father of a cluster bomb victim in the area, told reporters his children were playing outside when they found the unexploded weapon and brought that home.
"It exploded as they were playing with it. My son Ayan Ahmad was martyred and 11 people were wounded in the incident," Siddique said.
Cluster munitions can contain dozens of smaller bomblets that disperse over large areas, often continuing to kill and maim civilians long after they are dropped.
Civil-military huddle reaffirms resolve to thwart any Indian misadventure
Their use is banned under an international treaty, which neither India nor Pakistan has signed on to.
Prime Minister Imran Khan accused India of taking new aggressive actions, saying it could blow up into a regional crisis.
Amid heightened Indian aggression along the LoC Pakistan’s civil and military leadership doubled down on their resolve to thwart any Indian misadventure in a specially-convened National Security Committee (NSC) meeting in Islamabad.
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