Gunmen shot dead a paramilitary and wounded two others when they ambushed their patrol vehicle in Srinagar on Thursday, police said.
"One of the three BSF (Border Security Force) soldiers injured in the incident died," Abdul Gani Mir, Kashmir's inspector general of police, told AFP.
A BSF official, who cannot be identified, said the three members of the force were hit when gunmen opened fire as they drove through Nowgam on the outskirts of Srinagar.
The ambush came barely a week after militants disguised as cricketers killed five paramilitary police in Srinagar in the deadliest attack for nearly five years.
Violence in Kashmir -- a scenic Himalayan region which is divided between India and Pakistan and claimed by both -- had largely died down in recent years after a revolt began in 1989.
But tensions have mounted since the execution in February of a Kashmiri separatist over a deadly 2001 attack on the national parliament in New Delhi.