There were several explosions in the area near the consulate and buildings collapsed. A gun battle between police and the attackers followed.
Pakistan's main Taliban faction said it had carried out the attack, and that the US consulate was the target.
Officials said the attack was well organised but order had been restored.
US officials also confirmed the consulate was the target of the attack, but it is unclear whether the building suffered any damage.
“ Americans are our enemies - we carried out the attack on their consulate, we plan more such attacks ”
Azam Tariq Taliban spokesman
A police official told the BBC four militants and three security personnel had died in the assault, but there were no reported US casualties.
The raid came hours after 43 people died in a suicide attack at a rally in another north-western town.
The target of the attack, in Timergara, Lower Dir district, was a meeting of the Awami National Party (ANP), the ruling coalition in North West Frontier Province.
The Peshawar explosions took place near Shama Square, a major crossroads at the northern end of Peshawar's cantonment area, near the US consulate.
ANALYSIS
M Ilyas Khan, BBC News, Islamabad Monday's attack in Peshawar appears to be similar to recent gun-and-bomb raids in Lahore and Rawalpindi.
These have been co-ordinated assaults, with several gunmen moving in alongside suicide bombers to force their way into a facility - this time the "prized" US consulate.
The Pakistani Taliban were apparently aiming for a feat to match the one last December in Khost, Afghanistan, in which several American CIA officials were killed.
Another reason could be to try to ease military pressure on militants in Orakzai tribal district, where the Pakistani security forces launched a major operation last week.
America's presence in Afghanistan and US drone strikes on militant targets in Pakistan's tribal areas make the US a top target for the Taliban.
There are also some army barracks and offices of the army's Military Intelligence in the vicinity.
An Associated Press reporter at the scene said two of the explosions were just 20m from the consulate, which is in a heavily fortified area.
Pakistani police officer Ghulam Hussain told AFP: "The target was certainly the American consulate but they didn't succeed in getting there.
"One of the suicide bombers blew himself up close to the gate. Police guarding the US consulate started retaliatory fire. More blasts took place. We have recovered unexploded material from four different points," he said.
Taliban spokesman Azam Tariq said his group had carried out the raid.
"Americans are our enemies. We carried out the attack on their consulate in Peshawar. We plan more such attacks," he told Reuters news agency.
TV footage showed army soldiers taking battle positions on the main Khyber Road where the blasts took place, and witnesses told the BBC Urdu service a couple of armoured vehicles parked outside the consulate had caught fire.
An eyewitness told Reuters news agency that gunmen had attacked a checkpoint near the consulate.
"I saw attackers in two vehicles. Some of them carried rocket-propelled grenades. They first opened fire at security personnel at the post near the consulate and then blasts went off," said Siraj Afridi.
Peshawar, which is on the edge of Pakistan's tribal areas, has been frequently targeted by Islamist militants.
An official of the ruling ANP party, Hashim Khan Babar, told the media the attacks appeared to be in response to a major security operation which was launched in the Orakzai tribal region near Peshawar last week.
Story from BBC NEWS:
http://news.bbc.co.uk/go/pr/fr/-/1/hi/world/south_asia/8603288.stm
