UPDATE: Kenyan officials say that an unknown number of hostages remain inside the Westgate centre, as security forces say they have "pinned down" the gunmen.
UPDATE: At least 39 are dead and more than 150 have been wounded in the assault, Kenya's president announced on national TV.
UPDATE: William Hague has warned that British Nationals have undoubtedly been caught up in the Nairobi attack.
UPDATE: Somali Islamist militant group al Shabaab has told the BBC that they carried out the attack in Nairobi.
At least 39 have been killed and upwards of 150 injured in a terrorist attack on a shopping mall popular with Westerners in the Kenyan capital of Nairobi. Reports suggest that the attackers may have taken hostages in the upmarket shopping centre, having threatened to kill any "non-Muslims".
William Hague said on Saturday night that British nationals were undoubtedly caught up in the "callous and cowardly and brutal" attack, adding: "We should be ready for that and aware of that".
Earlier, Sir Simon Fraser, who works for the British Diplomatic Service, stoked fears that British nationals were caught up in the incident, tweeting: "@foreignoffice and @UKinKenya working hard on Nairobi shooting and hostage crisis to help all involved esp Brits."
— Simon Fraser (@SimonFraserFCO) September 21, 2013
A Downing Street spokesman said on Saturday: "The Prime Minister spoke to the President of Kenya, Uhuru Kenyatta, late this afternoon about the attack at Westgate shopping centre in Nairobi." The Foreign Office added: "We are in close touch with Kenyan authorities about the attack in Nairobi. Our urgent priority is the welfare of UK nationals in Kenya."
Al-Shabaab, also known as Harakat al-Shabaab al-Mujahideen (HSM), have claimed responsibility for the massacre. They wrote on their official Twitter account: "the Mujahideen entered Westgate Mall today at around noon".
Only Kuffar were singled out for this attack. All Muslims inside #Westgate were escorted out by the Mujahideen before beginning the attack
— HSM Press Office (@HSM_Press) September 21, 2013
Several men reportedly threw grenades into the Westgate Mall before opening fire indiscriminately around midday local time on Saturday. The mall, which has Israeli ownership and boasts many Western brands, including Nike and Bose, was holding a children’s day event at the time.
Reported by the Press Association, Elijah Kamau, a witness to the massacre, said that the attackers told all Muslims to go. "The gunmen told Muslims to stand up and leave. They were safe, and non-Muslims would be targeted," he said.
Injured children were carried out on trolleys
Speaking to the BBC, Hannah Chisholm, a Briton visiting the capital, said she and around 60 others barricaded themselves into a large storeroom.
She told the broadcaster: "We kept running to different places but the shots were getting louder so we barricaded ourselves along with about 60 others into a large storeroom. There were children hiding with us as well as someone who had been shot. The gunfire was loud and we were scared but at that point we thought the gunmen were thieves so we assumed they wouldn't try to reach the storeroom."
Arjen Westra also witnessed the attack. He said: "I could hear the gunfire moving towards the main entrance of the shopping mall, so some people ran out of our cafe in a kind of panic, and quite a number just fell down as flat as possible on the ground."
Reported by the Associated Press, witness Jay Patel said that he saw the gunmen with a group of people before entering the mall heavily armed. Another witness, 18-year-old Manish Turohit, said the attackers had AK-47s and vests with hand grenades. "They just came in and threw a grenade. We were running and they opened fire. They were shouting and firing," he said.
Hundreds trapped inside the mall made their way to the exits, many injured, including children. Staff used trolleys to wheel out the wounded. Nairobi police chief Benson Kibue has already called the incident a terrorist attack, while members of the Kenyan military have streamed to the scene.
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More from the Press Association:
Kenya has seen a rise in terror attacks and threats in recent years, some of which are believed to be in retaliation for a military crackdown on the Somali-based militant group al-Shabaab, which vowed to retaliate with a large-scale attack on Nairobi.
The attacks often involve gunmen armed with automatic weapons and grenades, and their targets include bars, nightclubs and restaurants in various parts of the country.
There was a suspected al-Shabaab attack which left five dead and three injured at a restaurant in the eastern city of Garissa in January, and in August last year one person was killed and six more were left injured in the Eastleigh area of Nairobi on the eve of a visit by Hillary Clinton, then the United States secretary of state.
Last month 18 US embassies and consulates across the Middle East and Africa were closed after a message between al Qaida officials about plans for a major terror attack was intercepted. British nationals have been told to avoid the Westlands district of Nairobi in the wake of the attack.
A Foreign Office spokesman said: "We are aware of the incident at the Westgate Mall shopping centre, and we are urgently looking into it. "We stand ready to provide consular assistance if there are any British nationals involved." The Foreign Office updated the travel advice on its website to say: "British nationals should avoid the area".