Getting information that a group of Maoists had gathered in the forest near Daringbadi area of the district for a meeting, police and special operations group personnel raided the area. There was an exchange of fire after the rebels attacked the security forces and a woman Maoist was killed, district collector Krishan Kumar told IANS.
A male Maoist rebel was also arrested from the spot, he said, adding two weapons were also seized.
Kandhamal, about 200 km from here, witnessed widespread communal violence after the murder of Vishwa Hindu Parishad (VHP) leader Swami Laxmanananda Saraswati and four of his aides at his ashram Aug 23.
While the police accused Maoists for that killing, leaders of Hindu organisations blamed Christians. At least 38 people were killed in the state and more than 25,000 Christians were forced to flee their homes after their houses were attacked by rampaging mobs even though Maoists claimed responsibility for the murder.
Maoists had also gunned down a Hindu leader March 18 in the same district.