Yemeni security forces have clashed with rebels in the Southern Abyan province where separatists are campaigning against the rule of Ali Abdullah Saleh, the country's president.
A government source said at least seven people, including an arms dealer with links to the separatists and two policemen, were killed in the fighting on Monday.
The source said the gun battle took place when security forces tried to arrest Ali al-Yafie, suspected of supplying arms to the separatists.
Al-Yafie was killed along with his wife and three children in the fighting that took place in the town of Zinjibar.
Security concerns
North and South Yemen united under Saleh's presidency in 1990 but many in the south, home to most Yemeni oil facilities, complain that northerners have used unification to grab resources and discriminate against them.
Yemen's government struck a truce deal with Shia rebels on Feburary 11 who they had been fighting in the north, allowing them to turn their attention to the rebellion in the south.
Authorities have often linked both northern and southern rebels to al-Qaeda, a charge the rebels deny.
Yemen rose to the forefront of Western security concerns after the Yemeni arm of al -Qaeda claimed responsibility for a failed attempt to bomb a US-bound plane in December.
Western governments and neighbouring Saudi Arabia, the world's biggest oil exporter, fear al-Qaeda is exploiting instability in Yemen to recruit and train fighters to launch attacks in the region and beyond.