Chad's government said Tine, on the frontier with Sudan, was attacked at the weekend by "mercenaries in the pay of Khartoum", the term it uses to describe rebels opposed to Idriss Deby, the president, who has ruled the country since 1990.
It said government forces repulsed the attack.
The fighting at Tine was the first serious clash reported between Deby's forces and the rebels since the insurgents attacked the capital, N'Djamena, on April 13, three weeks before polls which re-elected the president for a third term.
Yaya Dillo Djerou, of the Chadian rebel group SCUD, said: "Two officers from the government forces were trying to join us and asked for help. We sent fighters to get these people out."
He said rebel fighters occupied the Chadian side of Tine, which straddles the border with the Sudan, on Saturday night and then withdrew on Sunday after capturing equipment and destroying some vehicles. He gave no details of casualties.
A government statement released in N'Djamena said a rebel column of 67 vehicles attacked Tine on Saturday.
"The defence and security forces defeated the horde of mercenaries," it said.
Deby, whose rule is bolstered by the presence of a French military force stationed in Chad, has accused neighbouring Sudan of backing efforts to topple him by several
Chadian rebel groups operating largely from the east. Khartoum denies this.
The rebel groups including SCUD, which is made up mostly of army deserters, have announced a military alliance against Deby.
In a separate development, Deby sacked his eldest son, Brahim, as his adviser after the 27-year-old was arrested in a nightclub in Paris for possessing an illegal firearm and drugs. He was given a six-month suspended sentence by a French court.
The conviction was another personal blow to the Chadian president, whose leadership has been weakened by a spate of army mutinies and desertions, including by members of his own family and Zaghawa ethnic clan.
Two nephews, once also senior advisers, have abandoned him to join the rebel ranks and another nephew, the chief of Chad's armed forces, was killed in a clash with rebels this year.