The Russian made Mi171 came down while on a reconnaissance mission in Tamanrasset region, some 2,000km (1,200 miles) from the capital, Algiers.
The helicopter apparently experienced technical failure, but the exact cause of the crash is yet to be established, the ministry added.
Critics say Algeria has a poor aircraft safety record.
In 2014, 77 people were killed in a military plane crash.
Two military aircrafts collided during a training exercise in 2012, killing both pilots.
The reason for the helicopter's mission is not clear but militant Islamists are active in Algeria.
In 2014, Vietnam grounded its entire fleet of Mi171 helicopters after a crash near the capital, Hanoi, killed 18 soldiers.
(culled from www.bbc.com)
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