An attack by Al-Qaeda extremists on troops in Yemen's restive south sparked fierce clashes in which at least 78 soldiers and 25 militants were killed, medics and military officials said on Monday.

"The toll from the battles between the army and Qaeda militants ... has risen to at least 78" soldiers, a military official said on condition of anonymity.

He added that "dozens more were wounded ... in the surprise attack" Sunday on army posts on the outskirts of Zinjibar, Abyan's provincial capital.

"It was a massacre," he said.

A medic at a military hospital in the neighbouring port city of Aden confirmed the death toll and said staff were overwhelmed by the number of casualties.

"We were forced to use administrative offices and waiting rooms to treat the wounded," the medic told AFP, also speaking on condition of anonymity.

"The hospital was packed full with dead and injured" soldiers, he added.

Military officials had reported fierce clashes Sunday when militants linked to Al-Qaeda tried to overrun an army post in Kud, just south of Zinjibar. The violence then spread to other military positions on the outskirts of the city.

At least 25 Al-Qaeda gunmen were killed in the fighting, a local official from the nearby militant stronghold of Jaar told AFP, adding that several others were wounded.

He said that at least 56 soldiers were taken prisoner by Al-Qaeda, including seven army officers and 10 wounded soldiers.

The militants, known as the Partisans of Sharia (Islamic law), took control of Zinjibar and several other towns in Yemen's mostly lawless south last May as former President Ali Abdullah Saleh was facing mass protests demanding his ouster.

The military official, who was on the ground during the attack, said that troops from the Kud base were "surprised" to see the militants carrying army issue weapons and using military vehicles.

Soldiers who survived the attack accused some army leaders who had served under Saleh of "collaborating" with Al-Qaeda in the attack.

The assault was the latest in a spate of attacks against security forces since President Abdrabuh Mansur Hadi took over from Saleh and was sworn in on February 25 under a Gulf-brokered transition accord.

On Friday, Hadi, who must restructure the army during his two-year interim period in power, named General Salem Ali Qatan to head the 31st Armoured Brigade in southern Yemen.

The post had been held for decades by General Mahdi Maqola, known for his close ties to Saleh and accused of corruption.

Saleh has repeatedly declared himself a US ally in its "war on terror" but critics charge he may have deliberately surrendered cities such as Zinjibar to Qaeda militants to demonstrate to the west that only he can fight the extremists and should therefore remain in power.