The infighting erupted between terrorists of the so-called Islamic State in Iraq and the Levant (ISIL) and the Army of the Men of the Naqshbandiyah Order (JRTN) in Hawija, in the Iraqi province of Kirkuk, AFP quoted sources as saying.
There were differing accounts as to what sparked the firefight, with one security official saying JRTN fighters had refused an ISIL demand to give up their weapons and pledge allegiance to the jihadist force.
Witnesses, however, told AFP that the two sides clashed over who would take over multiple fuel tankers in the area.
Meanwhile, ISIL insurgents took control of an Iraq-Syria border crossing after Syria terrorists withdrew overnight, security officers and witnesses said.
The sources said insurgents took control of the al-Qaim border crossing, one of the three official border points between Iraq and Syria, after gunmen linked to the Free Syrian Army (FSA) and al-Qaeda-affiliated al-Nusra Front left.