A gunman shot dead two Saudi guards and wounded three others at the gate of the royal palace in the Red Sea city of Jeddah on Saturday, the interior ministry said.
Royal guards killed the gunman, identified by the ministry as a 28-year-old Saudi national armed with a Kalashnikov and three grenades, AFP reported.
“An outpost of the royal guard came under fire by a person who got out of a Hyundai car,” the ministry said in a statement carried by the official Saudi Press Agency.
He was immediately dealt with and his act also resulted in the killing of two royal guards, it added.
The US Embassy in Saudi Arabia had earlier cautioned its citizens over reports of the attack.
“Due to the possibility of ongoing police activity, American citizens are advised to exercise caution when travelling through the area,” the embassy said in a brief statement.
The warning comes after the Saudi police claimed it had raided hideouts of a “terror” cell linked to the self-styled Islamic State terrorist group this week, killing two people and arresting five others, according to the national security agency.
The State Security Agency said police raided three hideouts in the capital Riyadh and exchanged gunfire at one of them, the SPA news agency reported on Thursday.
The attack highlights the challenges facing the kingdom as Crown Prince Mohammed bin Salman implements unprecedented measures to overhaul the economy. The last known major assault on the royal family dates back to 2009 when a suicide bomber unsuccessfully tried to kill Mohammed bin Nayef, who was then leading the crackdown on al-Qaeda militants as assistant interior minister.
Last month, Saudi authorities also arrested several prominent conservative clerics and other people who have opposed the ruling family in the past before a historic decision to join the rest of the world in allowing women in the kingdom to drive.
The rise of IS, whose ideology is inspired by the hard-line Saudi clergy supported by the regime,  has seen a resurgence of the terror threat, with 2,500 Saudi nationals joining the group, making the kingdom its second highest source of foreign fighters as it carved out its ‘caliphate’ in Iraq and Syria.
In 2007, diplomatic cables leaked to WikiLeaks revealed that the US considered Saudi Arabia to be the main source of funding for extremist militants across the globe, NewsWeek reported.
In 2014, Saudi Arabia banned IS, designating it a terror group and joining the international coalition combating it.
The group has launched a series of attacks in Saudi Arabia, killing 25 in attacks on Shia mosques in the country’s Eastern Provinces in May 2015, and launching a series of bombings in July 2016, including one close to Prophet Muhammad’s (PBUH) Mosque in Medina.
IS regards Shias as heretics punishable by death.