Rescuers were struggling to reach the Chinook, which came down during an anti-Al-Qaeda mission in the mountainous eastern province of Kunar Tuesday, but the fate of those travelling in the chopper was not known, officials said.

The fundamentalist Taliban militia, ousted by a US-led invasion in late 2001 for harbouring Osama bin Laden, claimed responsibility for downing the giant twin-rotor helicopter west of the city of Asadabad.

"Initial reports indicate the crash may have been caused by hostile fire. It crashed while dropping people to the ground," US military spokesman Colonel James Yonts told reporters in the capital Kabul.

"When it was approaching the landing zone it took indirect fire and small arms fire. We know it was under fire but we don't know if that caused the crash," he said.

"The status of the 17 servicemen remains unknown."

Battles between US-led troops and militants near the wooded, mountainous crash site were still raging, while American warplanes were alternating patrols there to avoid any further fire from the ground, according to the US military.

"There are coalition forces in contact with the enemy right now," said Yonts.

The rugged landscape deep in the scenic Hindu Kush mountain range was also hampering the effort to find potential survivors, another US spokesman, Lieutenant Colonel Jerry O'Hara, told AFP.

"The terrain is a challenge and every challenge we work around," he said.

The crash, which would also be the deadliest single attack on US forces in Afghanistan if hostile fire is confirmed as the cause, comes amid fears that the war-shattered country is degenerating into Iraq-style chaos.

More than 500 people, most of them militants, have died since the Taliban launched a major offensive at the beginning of the year ahead of key elections in September.

A Taliban spokesman said the troop-transporting Chinook flew in after rebels seized and executed seven Afghans "working as spies for the Americans with satellite phones and maps".

"Among the seven, one of them managed to get the message out to the Americans, who came with helicopters," Taliban spokesman Mullah Abdul Latif Hakimi told AFP by satellite phone from an undisclosed location.

He said Taliban rebels shot down the Chinook near a village called Shurak and that all on board were killed. There was no way of independently confirming his account and some of his previous claims have proved to be untrue.

Asadullah Wafa, the governor of restive Kunar province, said a rocket was fired from the mountains in Watakur district but it was not clear if it had hit the helicopter.

A Chinook carrying 18 people, three of them civilians, went down in an accident in bad weather April killing all on board. It was the worst air crash suffered by the United States in Afghanistan.

Coalition forces flying missions above Afghanistan's difficult, rugged terrain have suffered nine helicopter crashes since the end of 2001, including Tuesday's, but this is the first attributed to enemy fire.

Seven previous crashes before the April accident had claimed 21 lives.

During a major operation against Taliban hideouts in southern Afghanistan last week, two Chinooks were hit by small arms fire. One had to make an emergency landing for repairs but then went on with its mission, the US said.

Scores of militants died in the joint Afghan and US offensive, one of the bloodiest in the last three years. Most were killed when US aircraft pounded militant positions in an 11-hour bombardment.

The bloodshed continued across Afghanistan Tuesday. Four policemen died when suspected Taliban set off a landmine a few kilometres (miles) from the site of the chopper crash. It was unclear if the two incidents were linked.

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