Ciputat, Indonesia  - An explosion was heard as Indonesia's counter-terrorism police on Friday fired on a house where suspected Islamic militants wanted for July's hotel bombings were believed to be hiding.

Police declined to comment on local television reports that two terror suspects were killed in the raid on a rented house in Ciputat, a university town some 30 kilometres south of Jakarta.

Metro TV reported that one of those killed was believed to be Syaefuddin Jaelani, who had been sought for his alleged key role in the July 17 bombings at the JW Marriott and Ritz-Carlton hotels.

The hotel bombings killed nine people and injured 53.

The man believed to be the mastermind behind the hotel attacks, Malaysian-born Noordin Mohammed Top, was killed in a police raid on a house in the central Java city of Solo last month. (dpa)