A woman and child are among at least 16 people found dead after clashes between Armenia and Azerbaijan forces broke out.

It’s been declared the biggest flare-up in violence between the two former Soviet republics since 2016, with both sides blaming each other for reigniting a three-decade-old territorial dispute over Nagorno-Karabakh.

Armenia accused Azerbaijan of launching an air and artillery attack on the breakaway region of Nagorno-Karabakh.

In response, Armenian troops shot down two military helicopters, and destroyed three tanks, its defence ministry said.

It said the shelling from Azerbaijani forces had killed a woman and a child. More than 100 other people have been injured in the conflict as of Monday morning (Australian time).

Meanwhile, Azerbaijan said its forces were retaliating against Armenian shelling, which reportedly injured 19 civilians and claimed five members of one family.

According to authorities in Nagorno-Karabakh, which is inside Azerbaijan but run by ethnic Armenians, the fighting left 16 of its servicemen dead and more than 100 wounded.

The flashpoints reignite concern about stability in the South Caucasus, a corridor for pipelines carrying oil and gas to world markets.

A still photo shows defeat of Azerbaijani armoured vehicles at Nagorno-Karabakh. Photo: AAP

Armenia and Nagorno-Karabakh declared martial law and mobilised the male population. Azerbaijan, which also declared martial law, said its forces had seized control of up to seven villages.

The clashes prompted a flurry of diplomacy to prevent a new flare-up of a decades-old conflict between majority Christian Armenia and mainly Muslim Azerbaijan, with Russia calling for an immediate ceasefire and another regional power, Turkey, saying it would support Azerbaijan.

Pipelines shipping Caspian oil and natural gas from Azerbaijan to the world pass close to Nagorno-Karabakh.

Armenia also warned about security risks in the South Caucasus in July after Azerbaijan threatened to attack Armenia’s nuclear power plant as possible retaliation.

Nagorno-Karabakh broke away from Azerbaijan in a conflict that broke out as the Soviet Union collapsed in 1991.

Though a ceasefire was agreed in 1994, after thousands of people were killed and many more displaced, Azerbaijan and Armenia frequently accuse each other of attacks around Nagorno-Karabakh and along the separate Azeri-Armenian frontier.

In Sunday’s clashes, Armenian right activists said an ethnic Armenian woman and child had also been killed.

-with AAP