A priest has been killed in the Normandy region of northern France after two ISIL operatives armed with knives took hostages in a church before being shot dead.

A priest has been killed in the Normandy region of northern France after two ISIL operatives armed with knives took hostages in a church before being shot dead.

Father Jacques Hamel, 84, had his throat slit, investigative sources said.

Five people – reportedly the priest, two nuns and two worshippers – were inside the church in Saint-Étienne-du-Rouvray, near Rouen, when it came under attack.

Pierre Henry Brandet, an interior ministry spokesman, said the church was surrounded by the BRI, France’s “anti-gang brigade”, which specializes in kidnappings, and that “the two assailants came out and were killed by police”.

Brandet, said one of the hostages had been critically wounded, while the three others were unharmed.

He said the hostage-takers had been "neutralized" after coming out of the church, and that the police were now searching the church for explosives.

The area has been cordoned off and police have told people to stay away, the BBC reported.

For its part, the Takfiri ISIL group claimed responsibility for the attack, saying the two attackers were its "soldiers".

French Prime Minister Manuel Valls has expressed his horror at the "barbaric attack".

"The whole of France and all Catholics are wounded. We will stand together," he wrote on Twitter.

President Francois Hollande has arrived in Saint-Etienne-du-Rouvray to be briefed by police.