Three armymen were killed and two, including an officer, were injured during the wargames in Pokhran.
Two havaldars and one gunner were killed when a mortar shell burst during firing, sources said.
A Junior Commissioned Officer and a jawan were injured in the mishap, they said.
A Court of Inquiry has been ordered into the incident.
In one of the biggest war manoeuvres in recent years, the Army and the Indian Air Force showcased their combat prowess, by effectively engaging latest array of weaponry in a joint air-land battle setting just 75 kilometres from Indo-Pak border in Thar desert in Rajasthan.