Two attackers seized hostages in a church near the Normandy city of Rouen on Tuesday, killing one hostage by slitting his throat before being killed by police, a security official said.
The identities of the attackers and motive for the attack are unclear, according to the official, who was not authorized to be publicly named.
The hostages included a priest, two nuns and two worshippers according to BFM TV.
French President Francois Hollande said that the two hostage takers were terrorists who had pledged allegiance to Islamic State. "Daesh has declared war on us, we must fight this war by all means, while respecting the rule of law, what makes us a democracy," he told reporters at the scene in Saint-Etienne-du-Rouvray, south of Rouen, using an Arab acronym for the Islamist extremist group.
The attack is the latest in a string of deadly assaults in Europe. In France, the Normandy attack comes 12 days after a 31-year-old Tunisian killed 84 people in the French Riviera city of Nice when he ploughed his heavy goods truck into a crowd of revellers. Islamic State claimed the attack in Nice.
The attack was the third major strike on France in 18 months and was claimed by the Islamic State group.
(With agency inputs)