No group has yet stepped forward to claim responsibility for the attacks but members of the Jihadist forum community commenting on two IS-affiliated websites said Islamic State group militants were engaged in the fighting.
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“This is an unprecedented attack”, he said.
Islamic State (IS) fighters in Libya claimed responsibility for an assault targeting a hotel that left 38 in June 2015.
The militants have taken advantage of a power vacuum since the NATO-backed overthrow of long-time dictator Muammar Gaddafi in 2011 to set up bases in several areas of Libya, including the Sabratha area between Tripoli and the Tunisian border.
The attack in Ben Guerdane – in the southeast of the country, along the Libyan border – is the second deadly clash in less than week as fighting in neighboring Libya threatens to spill across the border. The target of that airstrike was a militant commander linked to attacks on Western tourists at a museum and a beach resort in Tunisia a year ago.
According to local journalist Raoudha Bouttar, there was sporadic gunfire on Tuesday in the outskirts of Ben Guerdane as Tunisian forces searched for attackers still at large.
The Tunisian military sent reinforcements and helicopters to the area around Ben Guerdane and authorities are hunting several attackers who are at large.
Monday’s standoff is among the deadliest violence Tunisia has ever seen between security forces and extremists. “The majority of Tunisians are now in a state of war against barbarism”, Essebsi said.
The government has issued a curfew in Djerba and Ben Gardane, encouraging people to stay in indoors as well as restricting travel around the border.
Last Wednesday, troops killed five militants in a firefight outside the town in which a civilian was also killed and a commander wounded.
The assault followed skirmishes in the region last week between Tunisian forces and well-armed militiamen also believed to be based in Libya, where the Islamic State has expanded its presence amid political chaos that has divided the country into two rival zones.
Essid said officials were still investigating whether the group of 50 militants had infiltrated across the frontier from Libya, though officials found three caches of arms, explosives and rockets in Ben Guerdan after the attack.
US officials said at the time that Chouchane was probably killed in the air raids.
Defence minister Farhat Horchani said last week that German and American security experts were coming to Tunis on Monday to help Tunisia devise a new electronic video-surveillance system of its border with Libya.
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Information for this article was contributed by Bouazza Ben Bouazza and Samuel Petrequin of The Associated Press; and by Heba Habib, Brian Murphy and Sudarsan Raghavan of The Washington Post.
