Two army personnel were shot dead during a drive-by shooting at an army base in Co Antrim last night, raising fears that the grim spectre of terrorism has returned to haunt Northern Ireland.

Two more military personnel were wounded along with two civilians in what is believed to be the first major terrorist attack in the province for over a decade. All four are said to be in a "serious" condition.

The shootings occurred at the Massereene Army base in Antrim, 16 miles north of Belfast, at 21.40 last night. It is understood that a car or van pulled up outside the main gates. Soldiers and security staff thought pizzas were being delivered and walked straight into an ambush.

Witnesses described hearing two long bursts of gunfire. At least six ambulances and three paramedic vehicles were dispatched to the scene and a total of six people were taken to Antrim hospital. The area around the barracks was sealed off and a major security operation was last night under way.

The attack is the first major incident believed to involve dissident republican terrorism since the Omagh bomb in August 1998. It would also be the first time members of the security forces have been killed by a Republican terrorist organisations since July 1997 when the Provisional IRA killed two members of the Royal Ulster Constabulary in Lurgan, Co Armagh.

If the killings are confirmed as the work of dissident terrorists, they represents a return to the campaign of assassination of soldiers and police officers that was meant to have ended when the IRA declared its final ceasefire in mid-July 1997.

The killings come just 48 hours after Northern Ireland's chief constable, Sir Hugh Orde, warned that the dissident terrorist threat was at its highest level since he took over seven years ago. Observers fear it could signal an upsurge in the campaign by splinter IRA groups to destabilise the political settlement that has Sinn Féin sharing power with its Unionist enemies.

Orde also confirmed that undercover British army troops were on paramilitary surveillance duties in Northern Ireland.

Nobody has yet claimed responsibility for the attack but security sources said the incident was undoubtedly the work of dissident organisations opposed to the peace settlement .

Orde's warning was prompted by intelligence reports that two republican splinter groups, the Real IRA and the Continuity IRA had recruited experienced, seasoned, ex-Provisional IRA veterans to its ranks recently.

Northern Ireland's first minister and the leader of the Democratic Unionist Party, Peter Robinson, said he was postponing a trip to the United States as a result of the shootings. He said they were a "terrible reminder of the events of the past".

Secretary of state for Northern Ireland Shaun Woodward condemned the attack as an "act of criminal barbarism". He said: "My thoughts are with the families of those killed and injured in this murderous attack. The prime minister is being kept closely informed. The contrast between those who serve the community and those who would destroy it could not be clearer."

Ian Paisley Jr, a DUP member for the Northern Ireland assembly, said the shooting could be a defining moment in the history of Northern Ireland. "For the last 10 years people believed things like this happened in foreign countries, places like Basra. Unfortunately, it has returned to our doorstep."

Kylie McLaughlin, who lives near the scene, said the shots sounded like machine-gun fire. "It was very scary. We were not sure what was happening."

Downing Street added in a statement: "This is a terrible incident that we utterly condemn and the prime minister's thoughts, first and foremost, are with the families of those killed and with those seriously injured in this attack.

"In recent days action has been taken to increase security in Northern Ireland. This is because of the increased threat from those who, even at this late stage, wish to ignore the wishes of the overwhelming majority … and attempt to derail the peace process."