Gunfire and explosions were heard at the complex and a cloud of smoke could be seen billowing from
the building.
A Kenyan police official said that security forces had rescued some hostages held by the attackers.
The official death toll now stands at 62 and more than 170 have been injuredsince the attack began on Saturday.
Kenyan Interior Minister Joseph Ole Lenku confirmed the number of dead. The Kenyan Red Cross had earlier reported that 69 people had been killed, but later revised its figure to 62.
The Somali al-Shabab movement has said it carried out the attack in retaliation for Kenyan military operations in Somalia.
Television pictures showed troops running towards the complex. Around 10-15 attackers were thought to be inside, lead by a white woman, probably of British origin.
It is not clear as yet what caused the blasts, or what impact they are having on the operation to rescue hostages taken by the militants, our correspondent reports.
The Kenyan interior minister said that the fire at the building was started by the "terrorists".
Three more attackers were killed this morning, and others injured, the Kenyan Interior Minister said.
By Sunday night, Kenyan security forces said they secured most of the shopping centre and that only a small number of hostages remained under the militants' control.
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