Air force spokesman Air Commodore Ibikunle Daramola initially said two jets were involved in an "incident" outside the capital Abuja as they prepared for Monday's event but added that no lives were lost.

But he added later: "It is with a heavy heart that I regretfully announce that one of the pilots who successfully ejected from one of the F-7Ni aircraft that crashed earlier today has passed on."

No further details were given but witnesses said the two jets were flying at a low altitude when one crashed into a hill at Katampe, on the outskirts of the capital.

"I saw the two jets flying together at a very low altitude. I thought it was a show of force," said James Ogbu, a civil engineer, who lives near the scene of the crash.

"Then suddenly I saw three persons in parachutes jumping out of one of the jets while the other jet was just hovering the sky."

"Two parachutes went to one direction while one went down straight and I saw the jet headed for the rocky hill."

The scene was cordoned off by security agents, according to an AFP reporter at the scene.

Motorists stopped their cars on the side of the road as thick smoke billowed into the sky from the burning plane. Firefighters and other relief workers helped with emergency operations.

Africa's most populous nation is a former British colony that won independence on October 1, 1960. The date is traditionally marked with a military parade and fly-past.