Indian commandos freed hostages from Mumbai's Taj Mahal hotel on Thursday but battled on with gun-toting Islamist militants who launched an audacious attack across India's financial capital, killing more than 100 people.

The gunmen arrived by boats in Mumbai on Wednesday, before fanning out and attacking luxury hotels, a landmark cafe, hospitals and a railway station, firing indiscriminately.

Some 17 hours after the late-evening assault, soldiers and militants were still exchanging intermittent fire and more than 100 people were trapped inside rooms of the Taj Mahal hotel, a 105-year-old city landmark.

"People who were held up there, they have all been rescued," Maharashtra state police chief A.N. Roy told the NDTV news channel. "But there are guests in the rooms, we don't know how many."

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Roy said some people were still apparently being held hostage at the nearby Trident/Oberoi Hotel. "That is why the operation is being conducted more sensitively to ensure there are no casualties of innocent people."

Police said at least six foreigners were killed and another 287 people were wounded in the attacks, which were claimed by the little-known Deccan Mujahideen group.

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