Seven suspects accused of killing five South African policemen were shot dead by officers late on Friday in a bloody gunfight outside a church, according to investigators.

The shoot-out erupted when police hunted down the armed gang that is alleged to have stormed a police station in Eastern Cape province and killed five officers and a retired soldier on Wednesday.

"The group which uses a church as a hiding place was cornered inside the church premises," the Hawks police investigative unit said in a statement.

"A gun battle between suspects and police ensued which left seven suspects dead and a task force member injured in the legs."

It added that 10 other suspects were arrested, while some escaped the scene near Ngcobo, the town where the policemen were killed.