Mr Abiy accused the region's ruling party, the Tigray People's Liberation Front (TPLF), of launching the attack.
He also said the group "tried to loot" military assets, in a statement posted on social media.
Details of the attack could not be immediately verified.
Tensions between the government and TPLF have escalated in recent months, with both sides accusing the other of plotting to use military force.
In the statement, posted on his Twitter and Facebook pages, Mr Abiy said defence forces "have been ordered to carry out their mission to save the country".
He added: "The final point of the red line has been crossed. Force is being used as the last measure to save the people and the country."
The Tigray region's president, Debrestion Gebremichael, told reporters on Monday the government were going to attack - alleging it was punishment for organising its own election for the Tigray parliament in September, in direct defiance of the federal government and electoral board decision to postpone all elections.
The government has described the vote as "illegal". The national electoral board has since said the general election should go ahead in May or June of next year.
The Tigrayans held most of Ethiopia's political power from 1991 to 2018, when Mr Ahmed was elected. Since then, their power has waned.
Mr Abiy, who was awarded the Nobel Peace Prize in 2019, is facing increasing criticism from a number of sides, with some accusing him of locking up those who oppose his government.
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November 04, 2020 at 10:58AM
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Ethiopia PM orders military response to 'base attack' - BBC News
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