Explosions could be heard on Friday in Wana, the capital of the area which borders Afghanistan.
The two sides exchanged rocket and mortar fire, reports said.
"Fifty-four people were killed today, two were yesterday. They include 45 foreigners," Sherpao said.
'Successful policy'
The latest clashes were concentrated in the mountainous Azam Warsak, Shen Warsak and Kalusha areas of South Waziristan.
Residents say between 300 and 500 Uzbeks and Chechens are hiding in the area.
The government says the latest developments reflect the success of its policy to encourage local tribesmen to expel foreign fighters, instead of costly and politically damaging army operations.
Haji Sharif, a tribal leader, has ruled out any negotiations with the foreign fighters.
"We gave them shelter under our traditional Pashtun hospitality but they misused it and killed our people including tribal leaders," he said.
"We advised them to change their behaviour but they did not listen. Now we cannot tolerate them on our soil."
Thousands of al-Qaeda and Taliban fighters fled into Pakistan's tribal areas after the fall of the Taliban government in Afghanistan in late 2001.