Two attackers blew themselves up in the attack, one other was killed in an exchange of fire with police, while one remaining suicide bomber remained at large.
Police had surrounded the building, which houses the directorate of communication in Sharana, the capital city of Paktika province, a ministry statement said.
In the course of an ongoing gun battle "two policemen were killed and one wounded", while two attackers were also killed, said the statement.
"Afghan National Police are engaging in a gun battle with remaining attackers," it said.
Provincial governor Muhibullah Samim told AFP later that a third attacker had been killed, adding that the group of bombers had planned to target an intelligence office close to the building they had taken over.
The attackers first killed a police guard at the gate before seizing the building, Paktika provincial spokesman Mokhlis Afghan said.
One bomber was killed in an exchange of fire with the police at the gate and a second blew himself up later in the building, killing another policeman, he added.
Afghan police and intelligence operatives are regular targets of Taliban insurgents fighting the government of President Hamid Karzai, along with national and foreign military forces.
A Taliban bomb attack killed 10 Afghan police returning from a recruitment centre in southern Afghanistan's southern Helmand province on December 29.
The victims were members of the US-funded Afghan Local Police (ALP) set up last year and touted as key to a handover of security control, which will see all foreign combat troops leave Afghanistan by the end of 2014.
The Taliban, who frequently use roadside bombs to attack Afghan and US-led NATO troops, claimed responsibility for that attack.
There are around 130,000 international troops, mainly from the United States, in Afghanistan helping government forces combat the insurgency.
Paktika province, which borders Pakistan, is one of the main strongholds of the Taliban-linked Haqqani network and one of the main routes for militant infiltration into Afghanistan from sanctuaries across the border.
The United States announced last year that it would focus its military operations towards the eastern provinces, where the Taliban and al Qaeda-linked militants slipped out of reach of a US-led invading force a decade ago.
The Taliban announced last week that it planned to set up a political office in Qatar, widely seen as a move towards peace negotiations with Washington and its Western allies.
But fighting has not stopped, with six children, five soldiers, three policemen and a civilian dying in another bloody day in Afghanistan's long war just three days after the Taliban announcement.
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