An eight-minute firefight erupted when armed men jumped out of a white or grey car around 11 a.m. local time (8:00 GMT) and began shooting at police guarding the consulate, also firing at the building.

The gunmen were shot and killed on the spot and a fourth attacker fled in the car, as the authorities launched a manhunt for the car and its driver.

Istanbul Governor Muammer Guler told reporters one policeman was killed at the scene and two others died of their injuries in hospital. A policeman and a civilian driver of a police truck were injured.

No consulate staff members were hurt, as the building lies some distance from the gate of the mission, where security prevents vehicles from stopping on the road surrounding the fenced premises.

The identities and motives of the attack remained a mystery at the time of compiling this report, leaving room to speculate on the identities of the attackers, their affiliations, and whether it was politically-motivated.

The Interior Ministry was due to issue a detailed statement surrounding the incident later in the day.

But Turkish officials and U.S. diplomats quickly condemned the attack as a terrorist one, as the investigation was given to prosecutors specializing in terrorism cases.

"I strongly condemn such terrorist acts," Turkish President Abdullah Gul said. "Turkey will fight to the end against those who are behind them."

U.S. ambassador to Turkey, Ross Wilson, said in Ankara the assault was "an obvious act of terrorism" aimed at the United States.

"We remain a close friend and ally of Turkey. We will not be deterred in any way by terrorists who are seeking to strike at us or at U.S.-Turkish relations," Wilson added.

Security was reinforced around American diplomatic missions across the country following Wednesday's clash.

Security sources said the dead attackers, who used pistols and rifles, were Turkish nationals, as eyewitnesses who spoke to the media implied they may have been Islamic extremists, describing one of the assailants as being "bearded."

The U.S. consulate was moved from the crowded center of Istanbul in 2003 to an imposing hilltop in Istinye, a residential neighborhood along the Bosporus Strait, for security reasons following a series of attacks targeting British interests and synagogues.

Islamist militants linked to al-Qaida were blamed for a car bomb at the British consulate in central Istanbul in 2003 and a simultaneous attack at the British HSBC bank, as well as bombings of two synagogues in the same city five days earlier. About 60 people were killed in the country's four deadliest terror attacks, including at the British consul.

No one claimed responsibility for Wednesday's attack, but Turkish analysts said it did not appear to have the fingerprints of al-Qaida, which often resorts to bombings or suicide bombings, not gunbattles.

Commentators say the attack was clearly "unprofessional" and not well-planned, but may have been carried out by individuals sympathetic to al-Qaida or, at best, angry at the United States.

These pundits say the gunmen had come on a "suicide mission" because they continued to fire at the guards until they were killed, seeking to send a message that U.S. interests in Turkey, as well as those who protect them, are now threatened.

The attack could inspire other anti-American elements to carry out similar attacks in the country with whatever weapons they can find, Turkish analysts warn.

Meanwhile, the Turkish authorities have this time not pointed the finger at their usual suspects: the Kurdistan Workers Party (PKK), a Marxist outlawed guerilla group seeking Kurdish autonomy that has claimed responsibility for a series of attacks in the country since the 1990s.

The PKK – on the Turkish, U.S. and European terror blacklists – may have been ruled out early on in the investigation because the group has not targeted Western interests in the past, but against Turkish public institutions and tourist attractions to scare away foreigners.

Some analysts say it may be premature to dismiss possible PKK responsibility for Wednesday's attack in Istanbul, Turkey's largest city that attracts 20 million tourists a year.

Since last winter, the United States has shared intelligence information with the Turkish military to hunt down PKK bases and fighters in northern Iraq, and the group might be striking back while at the same time threatening the stability of one of Turkey's highest tourism revenues during the high summer season.

However, until someone claims responsibility for the attack on the U.S. consulate or the Turkish authorities identify the attackers, speculation will continue over who would target an American diplomatic mission in the country and why.