Chinese authorities shot dead eight suspected terrorists who attacked a police station in the ethnically tense northwestern region of Xinjiang.

Nine knife-wielding attackers tried to raid a police station in Shache county, the Communist party's official news agency Xinhua reported.

The attackers threw explosives and burned police cars outside the building, prompting the authorities to take action.

Eight were killed at the scene while the remaining attacker was taken into custody. Police are investigating the incident.

Xinhua described the assailants as "terrorists" while the Xinjiang government used the world "thugs".

The attack was the latst in a series of incidents that have left a dozen people dead in recent months, underscoring mounting ethnic tension in the region.

Xinjiang is home to the Uighur, a Turkic-speaking predominantly Muslim ethnic group, and witnesses periodic outbreaks of anti-government and anti-Chinese violence.

"To label the protesters as terrorists and shoot them to death is a new way of suppressing the Uighurs following China's judicial reforms," Sweden-based Uighur activist Dilxat Raxit said.

The Uighur, who are the largest ethnic group in Xinjiang, complain they are discriminated against by Chinese ethnic Han migrants who have flooded into the region in recent decades.

In November Beijing blamed a terrorist attack at the famous Tiananmen Square on a little-known Islamist group linked to the Uighur cause, the East Turkestan Islamic Movement (ETIM).

According to official statistics, about 45% of Xinjiang's population is Uighur while 39% is Han. However Han dominate senior business positions.