8 March 2011 Last updated at 02:51 ET 
Gunmen in trucks and other vehicles had exchanged fire around the town, reports said.
Tamaulipas has been at the centre of a turf war between the Gulf and Los Zetas cartels, which are battling to control lucrative drug smuggling routes.
Mexican media say Abasolo has lacked a state police command post for several months.
Reports said Tamaulipas residents exchanged Twitter messages about Monday's shootings hours before the bloodshed was confirmed by the state government. Some tweets warned people to stay indoors.
The shooting, which began at about 0650 local time on Monday, lasted several hours.
In a brief statement, the state government said federal troops and police had been sent to restore order.
Abasolo is an agricultural community about 100km (60 miles) from the state capital, Ciudad Victoria, and has a population of about 14,000.
Last month, shootings in the nearby town of Padilla also left 18 people dead.
More than 34,000 people have been killed in drug-related violence in Mexico since President Felipe Calderon launched an offensive against the drug gangs in late 2006.
Mexico shootout leaves 18 dead in Tamaulipas state
Gunbattles between rival gangs in a north-eastern Mexican town have left 18 people dead, police say.
The Tamaulipas state government said shooting erupted in the town of Abasolo but gave few details. Gunmen in trucks and other vehicles had exchanged fire around the town, reports said.
Tamaulipas has been at the centre of a turf war between the Gulf and Los Zetas cartels, which are battling to control lucrative drug smuggling routes.
Mexican media say Abasolo has lacked a state police command post for several months.
Reports said Tamaulipas residents exchanged Twitter messages about Monday's shootings hours before the bloodshed was confirmed by the state government. Some tweets warned people to stay indoors.
The shooting, which began at about 0650 local time on Monday, lasted several hours.
In a brief statement, the state government said federal troops and police had been sent to restore order.
Abasolo is an agricultural community about 100km (60 miles) from the state capital, Ciudad Victoria, and has a population of about 14,000.
Last month, shootings in the nearby town of Padilla also left 18 people dead.
More than 34,000 people have been killed in drug-related violence in Mexico since President Felipe Calderon launched an offensive against the drug gangs in late 2006.
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