Al-Qaida members were believed to be among the attackers and after the dawn raid, the militants were in control of several neighbourhoods of Houta, the provincial capital of Lahj province, the officials said.
The officials also said that bands of militants drove through some neighbourhoods in the southern port city of Aden early today, opening fire on security and forces. They had no further details.
The officials spoke on condition of anonymity as they were not authorised to talk to the media. Islamic militants, taking advantage of more than four months of political turmoil in Yemen, attacked and seized two other southern cities in Abyan province in late May.
Massive anti-regime protests have swept much of the country since February and rival forces are squaring up to each other in the capital Sanaa after days of fierce fighting earlier this month.
Ali Abdullah Saleh, the country's president of nearly 33 years, is in neighboring Saudi Arabia for treatment from wounds he suffered in a rocket attack on his compound in Sanaa.