At least 12 Turkish servicemen were killed on Sunday in an ambush by Kurdish militants. The Kurdistan Workers Party (PKK) says it is holding the missing Turkish soldiers hostage.
Turkey's NTV channel cited the Turkish military General Staff as saying a large-scale counter-insurgency operation is ongoing in the area.
Turkey's leadership gathered for an emergency meeting on Sunday evening after the PKK's deadly attack in Turkey's Hakkari province, which borders on northern Iraq. Rebels blew up a bridge as a 12-vehicle military convoy was crossing it.
Prime Minister Recep Tayyip Erdogan said Ankara would take all possible steps under international law to suppress the militants.
Last Wednesday Turkey's parliament sanctioned military cross-border operations against around 3,500 PKK insurgents believed to be based in Iraq, following an earlier government request. Turkey has deployed up to 100,000 troops along the border, along with tanks and fighter jets.
The U.S. condemned the Kurdish attack, but urged Turkey not to launch a cross-border offensive against Kurdish rebels.
Erdogan said U.S. Secretary of State Condoleezza Rice had asked him in a telephone conversation on Sunday to hold off any cross-border action "for a few days."
Meanwhile, Turkey's General Staff confirmed that army units, backed by helicopters, were attacking PKK rebels along the border, and that artillery had pounded 63 suspected rebel positions.
The PKK, listed by the U.S., NATO and the EU as a terrorist organization, has been fighting for autonomy status in southeast Turkey for nearly 25 years, and has recently intensified attacks along the Iraqi border. The conflict has so far claimed about 40,000 lives.