A defence spokesman told IANS the three guerrillas were killed in a joint operation by the army and the state police at Kalibari Janglote camp.
One soldier was killed in this operation while another was injured, he added.
After the twin terror strikes on the highway, traffic on the otherwise busy Jammu-Pathankot highway was stopped.
Chief Minister Omar Abdullah condemned the terror strike.
"I would like to unequivocally condemn today's militant attack in Kathua area of Jammu," he tweeted.
"I will not be commenting or reacting to today's events until the security forces have declared the operation as concluded," he added.
The attack is reminiscent of a similar terror strike in Kathua district Sep 26, 2013, when guerrillas first stormed the Hira Nagar police station, killing five policemen and a civilian, and then attacked an army camp near Samba town.
