One Afghan border guard was killed and two Pakistani guards were injured when the two parties clashed near the controversial Durand Line, sources from both sides said on Thursday.
According to Afghan and Pakistani officials, an exchange of fire erupted late on Wednesday night that lasted for more than two hours.
A senior Afghan official said hundreds of additional Afghan troops were sent to a disputed border gate after the clashes.
A source in the Pakistani military said the clashes were sparked by an attack on a Pakistani border checkpost. However, the Afghan official said the exchange of fire erupted after Pakistani troops attempted to fortify the border gate.
Pakistan has recently been building a military gate, which Afghan officials say is in the Afghan territory.
Afghan President Hamid Karzai has ordered his top officials to take immediate action to remove the gate and other Pakistani military installations near the Durand Line.
Pakistan recognises the Durand Line, the 1893 British-mandated border between the two neighbours, but Afghanistan says that activity by either side along the Durand Line must be approved by both countries.