Shah visited a higher secondary school in R.S. Pura area where villagers from the border areas have taken shelter because of Pakistani firing.
The Bharatiya Janata Party (BJP) leader also went to a safe accommodation for displaced villagers at Bishnah town in Jammu.
Shah told them that the Indian military was fully equipped to give "a befitting reply" to the Pakistan troops.
But Shah's visit was marred by a scuffle between National Conference leader T.S. Tony and BJP legislator Sham Choudhary.
Tony, a candidate from Suchetgarh in the coming assembly elections in Jammu and Kashmir, raised slogans against Shah and the BJP when the latter reached the school building in R.S. Pura.
Tony told IANS that whenever political leaders meet displaced villagers, they rise above party politics.
"I had gone there in that spirit not knowing that the BJP had intended to convert the visit as a campaign to garner voters for its candidate," Tony said.
BJP legislator from Suchetgarh, Sham Choudhary, got into a scuffle with Tony, causing an ugly scene.
Shah will address a rally in Kathua town Monday where senior Congress leader and two-time Lok Sabha member Choudhary Lal Singh is likely to join the BJP.
Tension has gripped parts of Jammu and Kashmir close to the border with Pakistan following heavy firing between the militaries of the two countries.