The attack took place on Friday.
The attackers arrived in the town of Geidam in the state of Yobe in eight vehicles equipped with machine guns and the victims were killed when two adjoining houses were hit by arson during fighting between the military and jihadists.
-We lost eleven people in the terrorist attack, says Ali Kolo Kachalla at Geidam's local government.
He says that the jihadists are still in Geidam.
The city has been attacked several times before.
Iswap was formed as a breakaway group from Boko Haram in 2016. The extremist Islamist armed uprising in northeastern Nigeria that began in 2009 has claimed at least 36,000 lives and forced over two million people to flee.