Security forces surrounded fighters with al-Qaida who were holed up in the city of Ludar. The seven insurgents were killed after al-Qaida fighters rejected an ultimatum to surrender, the official Saba news agency reports.
The report adds members of al-Qaida have surrendered in large numbers in Abyan following renewed vigilance against the group.
Clashes between al-Qaida and government forces killed seven militants and 11 soldiers in Abyan last week.
Al-Qaida in the Arabian Peninsula, the Yemeni branch of al-Qaida, was tied to several terrorism plots in the United States.
Saeed Ali al-Shihri, the deputy leader of AQAP, in an audio message posted recently on the Internet called on sympathizers to topple the Saudi monarchy for supporting the U.S.-led counter-terrorism offensive in Central Asia and the Middle East.
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