Mohamed Nur Aga Jof, governor of Jalalaqsi town, said the militants were on a public vehicle and the forces got intelligence that al-Shabab fighters were on the road to attack their military base.
"There was a fierce confrontation between the army and the militants, and we finally killed 20 al-Shabab militants who were on board the vehicle," the official said.
He noted the forces also recovered 18 guns from the militants. Residents reported seeing bodies on the street following the intense clashes.
"We heard gunfire and later learned that government forces attacked al-Shabab militants who were sneaking into the town. There were bodies on the street this morning," Yahye Gelle, a resident, told Xinhua over the phone.
The latest operation came barely four days after Somali forces killed 11 al-Shabab militants in the country's southern region of Gedo.
The Somali army backed by the African Union Mission to Somalia (AMISOM) chased al-Shabab extremists away from the capital Mogadishu in August 2011, but the militants still hold swathes of rural areas in central and southern regions.