"We have imposed a curfew and called out the army after exchanges of fire between members of the two sects," Sahibzada Mohammad Anis, the top administrator in Parachinar, the main town in Kurram region, told Reuters.
Sectarian violence has bedeviled Pakistan since the 1980s, and thousands of people have been killed in tit-for-tat attacks across the country, although the vast majority of Pakistani Sunnis and Shi'ites live in peace.
Shi'ites account for around 15 percent of Pakistan's 160 million population.
Like the rest of the country, Pakistan's seven semi-autonomous tribal regions have pre-dominantly Sunni populations, though there is a sizable Shi'ite presence in Kurram and neighbouring Orakzai.
Men in the ethnic Pashtun tribal lands typically bear arms, and the Taliban and al Qaeda have garnered support among Sunni Muslims in poorer parts of the Federally Administered Tribal Areas.