Reports said police tried serve search warrants in the Parojinog residence when they were met with gunfire from his security.
Among those killed were the mayor's brother, Octavio Parojinog, a provincial board member, GMA News reported.
Police in the southern Philippines said they fatally shot 15 people Sunday, including a city mayor who was among the politicians President Rodrigo Duterte publicly linked to illegal drugs, in the bloodiest assault so far in Duterte's anti-drug crackdown.
Ozamiz city mayor was among list of officials publicly shamed a year ago by President Duterte of being linked to drugs.
Duterte has promised an unrelenting war on drugs, defying critics who were "trivializing" his campaign with human rights concerns and unjustly blaming the authorities for the bloodshed.
Duterte claims to have a private list of up to a million people suspected of involvement in the drug trade, including thousands of police officers and local leaders.
Critics say Duterte has turned a blind eye to thousands of deaths during police operations that bear all the hallmarks of executions.
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A pool of blood surrounds the bodies of 3 men killed in a police raid against the Parojinogs.
Pacleb said the mayor's daughter, Vice Mayor Nova Princess Parojinog, was arrested during the operation.
At least five were arrested, including Parojinog's daughter, Nova Parojinog Echavez, who's also the city's vice mayor.
Abella said said authorities are expected to release updates as soon as they become available.
An investigator inspects the pieces of evidence seized during a raid of the Parojinog family's properties.
More than 7,000 people are said to have been killed since Duterte launched a war on the drugs trade last July.
Last year, police officers shot dead Albuera Mayor Rolando Espinosa Sr. inside a jail cell in the central province of Leyte.
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He added that most Filipinos recognize the seriousness of the situation in Mindanao and back Duterte's martial law proposals. Others anxious that the extension was too long and that the rest of the country may eventually be placed under martial rule.
Policemen were approaching the mayor's house when his bodyguards opened fire and hit a police vehicle and injured an officer, sparking a firefight amid a power outage, Mr Espenido said.
"Despite global and local pressures the fight will not stop until those who deal in it [drugs] understand that they have to stop because the alternatives are either jail or hell, " he said.
Police 10 regional director Superintendent Timoteo Pacleb said it took the police two hours before they could breach the house of the mayor.
"I am asking President Duterte to investigate this and the Senate of the Philippines", she said, as family members stirred her away from reporters.
Commenting on Sunday's raid, presidential spokesman Ernesto Abella said: 'The administration vowed to intensify the drug campaign'.
Mr. Duterte, in his 2 State of the Nation Address last June 24, warned that the drug campaign will continue to be "relentless".
She said Parojinog did not spare those he suspected to be involved in illegal drugs, including his kin.
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