Anton Bahrul Alam, the deputy national police spokesman, said police surrounded a house thought to be Top's hideout in central Java before dawn.
"We attacked them but they were fighting against us using M-16s," he said. "So there were exchanges of fire."
He said that two men were killed and two captured.
"But unfortunately Noordin M Top was not there," he said, despite police having expected to find the fugitive at the site in Wonosobo, 375km southeast of Jakarta.
Top, a Malaysian national who belongs to the Jemaah Islamiah group, which is linked to al-Qaeda, is wanted over a string of bombing attacks in Indonesia.
Last year police killed Azahari bin Husin, another leading figure in Jemaah Islamiah, in a shootout.
The group is blamed for the Bali bombings in 2002 that killed 202 people and a series of other attacks.
Alam said those killed or captured on Saturday were believed to be aides of Top who were also involved in various bombings.
As well as the initial Bali bombings, there have been deadly strikes attributed to Islamic militants against a hotel in Jakarta in 2003, outside the Australian embassy in the capital in 2004, and at restaurants in Bali in 2005.
About 85% of Indonesia's 220 million people are Muslims. Most are moderate, but a militant minority has been increasingly active in recent years.