Heavy gunfire broke out in a restaurant in Mali's Bamako killing at least five people including a French national and a Belgian.
AFP quoted hospital sources as saying that a third European, whose nationality was yet to be ascertained, had also died; the others are from Mali.
The shootout took place at "The Terrace" restaurant in one of the busiest streets of Hippodrome district in the Malian capital. Islamist gunmen opened fire accompanied by a grenade attack.
Some gunmen are suspected to have fled the scene following the attack.
Eyewitness accounts said all the attackers were shouting "Allahu Akbar" (Allah is Great) while randomly spraying bullets on the people.
French troops are believed to have arrived at the area shortly after the attack.
The landlocked African nation has been reeling under a bloody Islamist insurgency for several years as al-Qaeda-inspired extremists launch attacks on the country's troops.
French and African soldiers have also waded into the conflict in support of government troops to wipe out the militants.
Didier Reynders and Laurent Fabius, the foreign ministers of Belgium and France respectively both condemned the attack.
"I condemn once again this cowardly dreadful terror which has struck," Didier Reynders said at a conference of foreign ministers in Riga, Latvia. "According to the information it may be in any case a terrorist attack."
Fabius, meanwhile, labelled the shooting as an "odious and cowardly act" and reaffirmed France's determination to "fight terrorism in all its forms".
French forces seized control of Mali's north from separatist Tuareg rebels and al-Qaeda linked fighters two years ago to put an end to their advance on Bamako, but the latest incident is bound to raise concerns that the capital will be increasingly targeted by militants.
France has deployed over 3,000 soldiers in west Africa as part of an effort to battle al-Qaeda affiliated militants.
Mali's President, Ibrahim Boubacar Keita visited the area on Saturday morning following the event.
"The Malian government has opened an enquiry and is determined to keep going until those guilty are found and punished as they deserve," a government statement said.
The French embassy in Bamako has warned its citizens to exercise caution if they go out in public.