"Gunshots, heavily armed exchange UN House area once again; going on now since approx. 0825 (0525 GMT)," the UN Mission in South Sudan (UNMISS) said on Twitter.
The UN House camp, close to where both former rebels and government soldiers are camped at the foot of a mountain to the west of the city, is home to roughly 28,000 people previously uprooted by the war.
The violence comes a day after the world's youngest country marked its fifth independence anniversary, and is a fresh blow to a peace deal that has failed to end the civil war that broke out in December 2013.
City residents in the area of the camp began fleeing their homes as the UN reported the use of mortars, rocket-propelled grenades and "heavy ground assault weaponry". A helicopter gunship was also reported above Juba.
A steady stream of fearful civilians, clutching children and possessions, was seen heading for the refuge of another UN base close to the city's airport.
A spokesman for former rebel leader turned vice president Riek Machar blamed government troops for the latest fighting.
"Our forces have been attacked at Jebel base," said James Gatdet Dak, who claimed the attack had been repulsed. "We hope it will not escalate," he said.
Currency collapsing, inflation spiralling
The outbreak of fighting on Sunday morning was the first since Friday when brief, but heavy exchanges of fire left an estimated 150 soldiers dead on both sides.
There were no details of casualties from Sunday's shooting.
South Sudan has seen more fighting than peace since independence in July 2011, with civil war breaking out December 2013 when President Salva Kiir accused Machar of plotting a coup.
An August 2015 peace deal was supposed to end the conflict but observers say the peace process has stalled while fighting has continued despite the establishment of a unity government.
This week's clashes are the first between the army and former rebels in the capital -- where the war broke out -- since both established positions there in April as part of the peace agreement.
In a statement the UN Security Council said the recent fighting showed a "lack of serious commitment" to peace on the part of Kiir, Machar and their supporters.
Tens of thousands have died in more than two years of civil war, close to three million have been forced from their homes and nearly five million survive on emergency food rations.
The humanitarian crisis takes place alongside an economic one with the currency collapsing and inflation spiralling out of control. The country's mainstay oil industry is in tatters and regional towns have been razed.
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