The fighters were attacked with ground fire and air strikes, NATO said. Gen. Murad Ali, the Afghan army regional deputy corps commander, said the insurgents had traveled into Paktika province with several trucks of ammunition.
A NATO statement said "initial battle damage estimates" indicated that as many as 150 fighters were killed. Ali said more than 50 fighters were killed late Wednesday and early Thursday. Mohammad Zahir Azimi, the spokesman for the Ministry of Defense, estimated the toll at 80.
It was not clear why there was such a disparity in the estimates. Independent confirmation of the death toll was not immediately possible on the remote battle site.
Dr. Muhammad Hanif, who claims to speak for the Taliban, said in a text message to an Associated Press reporter in Pakistan that the figure of 150 dead was "a complete lie."
"The Americans want to boost morale of their troops while making such claims," the message said.
Taliban militants last year launched a record number of attacks, and an estimated 4,000 people died in insurgency-related violence, the bloodiest year since the U.S.-led coalition ousted the Taliban regime in late 2001.
The fight in the Bermel district of Paktika province is the first major engagement of 2007 and appeared to be the largest battle since a multi-day operation killed more than 500 Taliban fighters in the Panjwayi district of Kandahar province in September.
NATO did not say how it estimated that 150 fighters were killed. In early December NATO said it had killed 70-80 fighters in Helmand province but days later said that only seven to eight were killed.
Azimi said one Pakistani fighter was wounded and captured. RPGs and machine guns were also recovered, he said.
In the southern province of Helmand, meanwhile, NATO forces called in air strikes on Taliban positions during a clash in the village of Gereshk on Wednesday, said Ghulam Nabi Mulahkhail, a local police chief.
Among those killed was a local Taliban group commander identified as Mullah Faqir Mohammad, the police official said One Afghan soldier was wounded and evacuated to a NATO medical facility, the alliance said in a statement.
The troops recovered weapons and ammunition in the militant compound following the operation, the statement said.
Meanwhile, Pakistan's army attacked supply trucks used by suspected insurgents for a cross-border raid in neighboring Afghanistan, a Pakistani military spokesman said Thursday. The army attack occurred across the border from where NATO forces reportedly killed or wounded 130 militants.
It was the Pakistani army's first reported attack in the North Waziristan tribal region since a controversial September peace deal between the government and pro-Taliban militants that critics say has provided a sanctuary for insurgents.
CBS News reporter Farhan Bokhari reports that the ISAF and the Pakistani military have agreed to intensify cooperation, including greater intelligence sharing, ahead of a major Taliban offensive in central Asia expected in spring 2007, according to key diplomats.
Senior western diplomats in the Pakistani capital tell CBS News the need for more cooperation was discussed during a trilateral meeting Thursday between representatives from the ISAF, the Afghan national army and the Pakistani military in Islamabad.
General David Richards, the ISAF commander, commended Pakistan at the conclusion of the meeting for its support in the fight against militants along its border with Afghanistan.
But, Bokhari says new questions emerged over Pakistan's role when NATO made the claim about having killed the 150 militants — who reportedly came from the Pakistani side of the border.