The attack happened in the town of Ngoshe in the state of Borno, according to Bulama Sawa, an official from the Gwoza area.
He told The Associated Press the attack was likely in retaliation for an operation by the military that killed three commanders of the militant Boko Haram group.
No one immediately claimed responsibility for the attack, which occurred on Friday, local time.
Nigeria is battling a complex security crisis from different armed groups. The United States has sent troops to the West African nation to help advise its military on the fight against insecurity.
Separate attacks this week also took place in the communities of Konduga, Marte, Jakana, and Mainok between Wednesday and early Friday, according to a military spokesperson.
The spokesperson, Uba Sani, said the troops were able to repel the attacks on the communities of Konduga, Marte, Jakana and Mainok, but "a number of brave soldiers paid the supreme price in the line of duty", along with a senior officer. He did not elaborate on military casualties.
Sani described the assaults as "failed attacks" and said they showed "increasing desperation of terrorist elements under sustained operational pressure" from the military.
Ulf Laessing, with the Konrad Adenauer Foundation, said Friday's attack on Ngoshe took advantage of the Nigerian army's difficulties in controlling large swathes of the nation where jihadi groups operate.
Militants are also benefiting from increased cross-border co-operation between their groups and the use of drones to scout out their targets before attacking.
"The army is fighting a ghost - fighters descending with motorbikes on villages and disappearing into the bush before the army can respond in time," said Laessing.
Among the most prominent Islamic militant groups are Boko Haram and its breakaway faction, which is affiliated with the Islamic State group and known as Islamic State West Africa Province.
There is also the IS-linked Lakurawa, as well as other "bandit" groups that specialise in kidnapping for ransom and illegal mining.
Recently, the crisis has worsened to include other militants from the neighbouring Sahel region, including the Jama'at Nusrat al-Islam wal-Muslimin, which claimed its first attack on Nigerian soil last year.
Several thousand people in Nigeria have been killed, according to data from the United Nations. Analysts say not enough is being done by the government to protect its citizens.
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