The standoff in the northern Balkh province began on Sunday night when the attackers first tried to storm the consulate, and then made their way into the adjacent building.
According to provincial police spokesman Sher Jan Durani, the armed men were shooting at the Afghan forces from inside the building into the morning hours. They were armed with RPGs, hand grenades and light weapons.
Details were sketchy but police reports said only one civilian was wounded.
Munir Ahmad Farhad, spokesman for the provincial governor of Balkh province said that by morning, security forces began a clearance operation in the area.
"The suspected house where the armed men have taken over is near the residential area, so we are careful to avoid civilian casualties." Farhad said.
Meanwhile, in the capital, Kabul, a suicide car bomber blew up his explosives-laden vehicle near the Kabul International Airport but killed only himself and harmed no one, said police spokesman Basir Mujahad.
An hour earlier, thousands had gathered to welcome the Afghan national football team after its match in the South Asia soccer final against India, but by the time the bomber detonated his car, they had dispersed.
No group has so far claimed responsibility for the Kabul attack or the Balkh siege but the Taliban have stepped up their attacks against Afghan security forces across the country.
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