B737-800
Flight Crew Instrument; Flight Crew Multiengine; Flight Crew Air Transport Pilot (ATP)
Flight Crew Type 822
Communication Breakdown
Aircraft Equipment Problem Less Severe; Deviation - Altitude Excursion From Assigned Altitude; Deviation / Discrepancy - Procedural Published Material / Policy; Deviation / Discrepancy - Procedural Clearance; Inflight Event / Encounter CFTT / CFIT
Air Traffic Control Provided Assistance; Flight Crew Took Evasive Action; Flight Crew Executed Go Around / Missed Approach
Aircraft; Human Factors
ATC assigned us to maintain 210 kts while vectoring us to intercept the Runway 28R Localizer and a descent to 3;000 feet followed by a clearance for the approach in VMC and to maintain 180 kts until 5 miles out. I asked the FO (First Officer) to set 1;800 feet in the MCP (Mode Control Panel) altitude window; pushed the approach button and verified FMA's (Flight Mode Annunciator) to be correct with Single Channel displayed while configuring the jet. The autopilot pushed the nose over while tracking the localizer and quickly descended below 1;500 feet. The ATC controller called out a low altitude warning approaching AXMUL. I disconnected the autopilot and started to climb towards 1;800 feet. The ATC controller issued a climb to 3;000 feet which confused us because we were not sure if he meant go-around. I commanded a go-around and executed the procedure while climbing to 3;000 feet in order to repair the unsafe condition and confusion over the perceived non-standard phraseology.
B737 Captain reported unsafe condition resulted from ATC climb clearance issued as flight crew was responding to to a previously issued low altitude alert.