An investigating team was sent to Helmand province's Gereshk district, where fighting took place between insurgents and Western forces late Friday, said Dur Ali Shah, the mayor of Gereshk, and Mohammad Hussein Andewal, the provincial police chief.
NATO's International Security Assistance Force has acknowledged some civilians were killed in the southern battle but has said the death toll was nowhere near as high as Afghan officials have claimed.
Because of the battle site's remote location, it was impossible to independently verify the casualty claims. Afghan officials said fighter jets and ground forces were still patrolling the region and that the fighting continued into Saturday.
A suicide attacker on foot blew himself up near a convoy of British forces in Gereshk district on Sunday, wounding several Afghans, an Associated Press reporter at the scene said.
The battle on Friday began when Taliban fighters tried to ambush a joint U.S.-Afghan military convoy, then fled to Hyderabad village for cover, said Helmand provincial Police Chief Mohammad Hussein. Airstrikes then targeted the militants in the village.
Shah said late Saturday that 50 to 60 civilians and 35 Taliban fighters had been killed but changed his casualty figures on Sunday, citing the investigation.
Maj. John Thomas, a spokesman for NATO's International Security Assistance Force, said the military had no information "to corroborate numbers that large." He said NATO would not fire on positions if it knew civilians were nearby.
"It's the enemy fighters who willingly fire when civilians are standing right next to them," he said.
Civilian deaths have infuriated Afghans. President Hamid Karzai has condemned the forces for carelessness and viewing Afghan lives as "cheap." He has also blamed the Taliban for using civilians as human shields.
The U.S.-led coalition said the airstrikes were in response to attacks on a joint Afghan-coalition patrol.
"It appears that ANA (Afghan National Army) and coalition forces fired at clearly identified firing positions," said Maj. Chris Belcher, a coalition spokesman. "Remains of some people who apparently were civilians were found among insurgent fighters who were killed in firing positions in a trench line."
Belcher accused militants of hiding among civilians.
Hyderabad resident Mohammad Khan said the airstrikes killed seven members of his family, including his brother and five of his brother's children.
Villagers were burying a "lot of dead bodies" Saturday, he said by telephone.