Soldiers in Puntland and Galmudug have clashed repeatedly over territory and political rivalries in recent years.
As well as fighting in a civil war that began in 1991, national forces, loyal to the Western-backed Mogadishu-based government, and regional militias are battling an Islamist insurgency.
The militias sometimes also attack each other.
Puntland said it had killed Islamist militants in an air raid but Galmudug said its soldiers were targeted.
"This [story of] killing militants is propaganda. Seventeen of our soldiers were killed and two of our military vehicles were destroyed by the air strike," Abdi Hussein, the deputy governor of Galkayo, the capital of the Galmudug region, told Reuters.
Galkayo hospital confirmed it had received 17 dead and 15 wounded soldiers.
