BAMAKO, Nov 20 - Gunmen attacked a luxury hotel frequented by foreigners in Mali's capital Bamako early on Friday and are believed to be holding hostages, a senior source with the security forces and witnesses said.

The raid targeted the Radisson Blu hotel, located just west of the city centre in a neighbourhood that is home to government ministries and diplomats, they said.

Northern Mali was occupied by Islamist fighters, some with links to al Qaeda, for most of 2012. Although they were driven out by a French-led military operation, sporadic violence continues.

"Very early in the morning there was gunfire. Apparently it's an attempt to take hostages. The police are there and are sealing off the area," the security source said.

Witnesses in the area said police had surrounded the hotel and were blocking roads leading into the neighbourhood.

The U.S. Embassy tweeted that it was "aware of an ongoing active shooter operation at the Radisson Hotel," and instructed its citizens to stay indoors.

An Islamist group claimed responsibility for the death of five people last March in an attack on a restaurant in Bamako popular with foreigners.