The last major attack in Jalalabad happened on July 11 when gunmen raided an education department compound in the city, sparking an hours-long battle with security forces.
Attahullah Khogyani, a spokesman for the provincial governor, said the militants killed at least 15 people, including a woman and a policeman.
It was unclear why the gunmen attacked the facility, which was occupied primarily by midwife trainees from the eastern province of Nuristan. There was no immediate claim of responsibility but most of the attacks have been claimed by militant group Islamic State.
While no group has claimed responsibility for the attack. This attack started with a suicide bomb outside, a distraction allowing the gunmen to take security by surprise.
"We saw several people wounded and helped to carry them away", Obaidullah said.
He said there had been at least three explosions.
Officials said a vehicle bomb was detonated close to the entrance of the compound at about 11.30am and was followed by two gunmen storming the building.More news: Reddit hack revealed: Here’s everything you need to know
More news: Blocking Trump on Wall Leaves Nation Unprotected
More news: Manchester United lodge big bid for Real Madrid's Mateo Kovacic
The final figure could exceed 20, said Sohrab Qaderi, a member of the local provincial council, going by his contacts with families who were missing relatives who had been present during the attack.
It is not clear why the militants targeted the refugees and repatriations department, but government buildings are frequently hit.
Officials have also confirmed that security forces have arrived in the area.
Grenades and gunfire could be heard coming from the scene of the attack. One hostage called security services and said that attackers told people inside the building not to move, he added.
On Monday Nangarhar provincial health officials raised concerns over the sharp increase in civilian deaths in the past three months in the province.
The victims add to a growing toll from roadside bombs and other explosive devices, which are among the main causes of civilian casualties in Afghanistan.
Earlier on July 1, a suicide bombing killed at least 19 people, mostly Sikhs and Hindus.