MOMBASA - Kenyan police on Monday confirmed that at least 27 people including a policeman were killed and an unconfirmed number of others were injured in Sunday night's attack in the coastal town of Mpeketoni in eastern Kenya.

Stephanie Goodwin, widow of Carey Eaton, co-founder of the online marketplace One Africa Media, comforts her son Noah (2nd R) as she attends with her daughter Llola the funeral service for her late husband in Nairobi June 13, 2014. [Photo/Agencies]

Inspector General of Police David Kimaiyo warned the toll could rise further as rescue was still underway in the busy town, where bars and cafes were packed with fans watching FIFA World Cup.

Earlier, police spokesperson Zipporah Mboroki said more than 50 masked gunmen descended on the busy town and sprayed bullets on villagers, and torched several houses and buildings including the local Equity Bank branch.

Mboroki also said the attackers also took away some civilian and police vehicles before setting an Administration Police camp on fire.

Eyewitnesses told Xinhua they had seen four bodies lying on the street and residents fleeing the trading center on the main coastal road amid sporadic shootings between police and the militants.

Military spokesman Emmanuel Chirchir confirmed the attack and blamed the Somali insurgents behind the latest attacks in the coastal town, which had been previously hit by bandits.

At around 8:00 pm local time (1700 GMT), the gunmen allegedly belonging to al-Shabaab entered Mpeketoni in two Nissan vans and started shooting people around in the town. Surveillance aircraft was already airborne, Chirchir said on his Twitter account.

The al-Shabaab militants have vowed to attack Kenya after the east African nation's soldiers crossed into Somalia in 2011 to flush out the insurgents it blamed for kidnappings of tourists.

Lamu District Deputy Governor Eric Mugo said the assailants who entered the town Sunday night were heavily armed and took advantage of darkness to cause mayhem on the residents of Mpeketoni.

"We are still combing the area but there is a lot of tension in the area," Mugo said.

Kenya has vowed to continue with the anti-terror war and urged countrymen to remain vigilant and report anything suspicious to the authorities.

The attack came two days after the British government closed its consulate office in Kenya's coastal city of Mombasa, citing security concerns.

The British Foreign and Commonwealth Office (FCO) said it would provide normal consular assistance to its nationals through the Nairobi embassy.

A spokesman for the British High Commission in Nairobi Stephen Burns confirmed the development, saying the decision had been taken after careful assessment of the security on the ground.

The latest incident came in the wake of a growing number of Muslim youth going radical in the coastal region. Police said they were monitoring the radical youth implicated in several attacks including killing of Muslim clerics.

The government said armed attacks and kidnappings threatened the country's tourism industry -- a key driver of the economy.