Security sources said nobody was hurt in the latest incident outside the vast, heavily fortified Iskan US military compound in southern Riyadh.

They said a convoy of three cars carrying US and Saudi personnel was leaving the compound when the gunmen, armed with automatic rifles, shot at one car. The gunmen then fled.

"There has been shooting in Riyadh against Americans this morning," said a Western diplomat.

The shooting heightened fears of further militant attacks in Saudi Arabia, a key US ally and the world's biggest oil exporter, after the weekend shooting and hostage-taking spree in the eastern oil city of Khobar in which 22 people were killed, including 19 Westerners and other foreigners.

The British embassy warned more attacks were probable.

Some 35,000 Americans live in Saudi Arabia and last month, the State Department urged them to leave the kingdom, citing possible militant attacks.

Last August, with neighboring Iraq now under its control, the United States ended more than a decade of military operations in Saudi Arabia amid resentment by Saudis over the American military presence near Islam's holiest sites.

But the US and Saudi militaries still cooperate on training.

Saudi-born Osama bin Laden and his al Qaeda network had reviled the US military presence and in 1996, a suspected al Qaeda suicide truck bomb in Khobar killed 19 American soldiers and wounded nearly 400 at a US military housing complex.

A purported al Qaeda statement also claimed the latest Khobar assault, the second in a month on the oil industry.

Saudi Arabia has been battling al Qaeda militants for over a year and the top al Qaeda leader in Saudi Arabia, Abdulaziz al-Muqrin, vowed in a purported Internet statement that 2004 would be "bloody and miserable" for the kingdom.

In a separate incident, Saudi forces killed two gunmen after clashes in the Western city of Ta'if, security sources said.

They said both were wanted "terrorists" but not linked to the Khobar attack. One of them, Abdul Rahman Mohamed Yazji, was on a list of the country's 26 most wanted militants, they said.

The shootout in Tai'f, close to the holy Muslim city of Mecca, began on Tuesday when gunmen fired on a police checkpoint in the mountainous region.

Saudi forces had launched a huge manhunt for three militants who fled after the Khobar attack, setting up checkpoints and roadblocks across the kingdom.