A ministry spokesman said on Tuesday the two men had been killed before they could carry out an imminent car bomb attack.

"Security forces were able to foil a terrorist operation on the afternoon of the blessed Eid al-Fitr," the spokesman was quoted as telling the official news agency SPA. 

"The security forces were able to disrupt this terror plot by clashing with the terrorists and flushing them out of their dens, which resulted in the death of two of them and the seizure of a car bomb which was ready to be detonated," he said. 

Saudi authorities were reportedly in the process of establishing the identities of the "terrorists" and said they would provide further details later. 

'No safe place'

In Washington, Saudi Ambassador Prince Bandar bin Sultan, said the police action showed "there is no safe place for al-Qaida in Saudi Arabia".

"We are hunting down the terrorists and flushing them from their hiding places ... God willing, we will continue to find them and bring them to harsh justice," he said.

Security in the kingdom has been stepped up over the past year, which has seen several clashes between police and armed groups.

In the past six months around 50 people have been killed in bombings in the capital Riyadh. In the most recent incident, a car bomb attack on a residential compound on 8 November killed at least 17 and wounded more than 100.