Gunmen have seized the police station of Armenia's capitol, Yerevan, taking everyone inside hostage.

Local residents reported to PanARMENIAN that the operation began around 5:30 a.m. A powerful explosion was first heard, followed by gunshot fire.

The attackers are members of the "Sasna Tsrer" movement. Literally "Daredevils of Sassoun," they style themselves after an 8th century epic which tells how David of Sassoun drove out Arab invaders from Armenia.

They demand the release of Jirair Sefilian, an opposition leader and former military commander, who was arrested in June. Deputy Police Chief of Armenia Hunan Pohosyan told reporters that the demand is impossible to fulfill.

Sefilian had harshly criticized Armenia's President Serzh Sargsyan, over the government's handling of a long-running conflict between pro-Armenian separatists and the Azeri region of Nagorno-Karabakh.

His supporters said today they wanted an "armed rebellion” to “change the state of things in Armenia.”

Reports say one man has been killed, and several wounded. Police chief Valery Osipyan is being held hostage.

Snipers have been seen gathering near the building, reports The Mirror.

Negotiations are currently underway with the armed assailants, for a peaceful surrender to the Armenian authorities, the National Security Service (NSS) announced in a statement to the press.

Two hostages have since been released. One of the hostages, a policeman wounded in the abdomen, was rushed into surgery at Muratsan Military Hospital.

The NSS has issued a gag order on local press, claiming supporters of the gunmen will use the media "to spread disinformation about starting an armed uprising, capturing buildings and premises."

Police cars and armored vehicles have blocked the road to the Erebuni police department.

One of the men posted a video on his Facebook page from inside the police station.

He wrote: "Erebuni special forces regiment occupied right now with all of the weapons and ammunition confiscated."

The group called for the public to gather in Freedom Square, near Yerevan's opera house, "for planning the next steps." Police have arrested several people in the square, including activist Vardges Gaspari.

In a report to PanARMENIAN, Armenian MP Nikol Pashinyan claimed to know nothing of the police's plans. In his opinion, the terrorists would not retreat in the event of an attack.

Pashinyan plans to meet with Jirair Sefilian in prison.