Fighting in recent days within striking distance of Liberia's capital, Monrovia, has led to panic among civilians and major disruption with thousands fleeing the area west of the city.
While it appears that forces loyal to President Charles Taylor have pushed rebel troops away from Liberia's coastal capital, hundreds of residents from nearby towns seized by the insurgents are reported to have fled.
The BBC reports that streams of people have been arriving at camps for displaced people in the western suburbs of the capital, Monrovia, after trekking through dense forests for three days to escape the clashes.
News agencies report the Liberians United for Reconciliation and Democracy (Lurd) rebels are renewing their threat to overrun the capital and oust Taylor, who has been in power since 1997 after waging a bloody seven-year civil war in Liberia.
This week's fighting is said to have reached as close as the strategic Po River Bridge, about 12km (8 miles) outside Monrovia, prompting hundreds of civilians to flee towards the city.
The army is reported to have pushed back the rebels, with one military official telling Reuters they were planning hot pursuit raids against their adversaries.
But rival government and rebel forces were said still to be battling around the key mining town of Tubmanburg, about 60km (38 miles) northwest of Monrovia. Last time the rebels entered Tubmanburg, it took Taylor's troops six months to dislodge them.
Liberian defence minister, Daniel Chea, confirmed Thursday that fighting continued in Tubmanburg. And Chea said the rebels were battling government forces around the town of Gba, 38km (24 miles) northwest of Monrovia, towards the Sierra Leone border. "(The rebels) were intercepted by an army division and they have been slugging it out since the morning," the minister told Reuters, predicting that rebel casualties would be high by the time the battles had ended.
Chea had earlier confirmed, Tuesday, that Lurd had recaptured the iron-ore producing town of Bopolu, located 100km west of Monrovia. Chea said at least six government soldiers were killed in the fighting.
President Taylor, who was attending an African Union (AU) summit in Ethiopia when fresh fighting broke out earlier this week, returned home on Wednesday amid tight security. He immediately appealed for calm.
He then called on the rebels to join him in regionally-mediated peace talks - under the auspices of the 15-member Economic Community of West African States (Ecowas) - in Bamako, the capital of Mali. "We hope that Lurd will seize the opportunity to come to these talks and join the democratic process," said Taylor.
He also urged the rebels to surrender their arms, set up a political party and take part in national elections, scheduled for 14 October.
"This government is going to do everything within its powers to defend this country and the lives and properties of our people," Taylor told the nation in an address broadcast on radio and television. But the Liberian leader's words apparently did little to reassure concerned residents of the capital and outskirts of Monrovia .
There was no immediate response from the Lurd rebels to Taylor's offer of dialogue and a "channel of communication," as he put it. This is the second time in less than a year that Lurd has reportedly come within a few miles of the capital, mirroring Taylor's own failed efforts to seize Monrovia during his days as a rebel chief.
But some Western diplomats, Liberia analysts and Monrovia residents question the authenticity of the purported rebel attacks. They believe these are sometimes faked by Liberian government soldiers, who exaggerate the rebel threat as a means to crack down on the opposition.
Observers say this sort of stage-managed assault could be an attempt to create a climate of fear and insecurity among Liberians, to put off exiled opposition politicians from coming home to challenge Taylor in the planned October polls.
Other reasons given for false alarms were a ploy to allow loyalist troops to loot and consolidate their positions and leverage to be able to lobby for an end to a United Nations' embargo on Liberia.
Taylor and other government officials are currently under UN sanctions, including an arms embargo, for backing Sierra Leonean rebels in return for what have become known as "blood diamonds" (of war) - as well as for alleged gun-running and trafficking in diamonds.
But Taylor is determined to quell the four-year rebellion. "Let no one be mistaken in believing that we will relinquish power," he warned, Wednesday. Since last year, Taylor's beleaguered forces have faced increasingly audacious and aggressive advances by Lurd from rebel bases in the north.
The French News Agency, AFP, reported residents saying that young men were being press ganged into joining the army. "Six youths who were playing football in our area were forced into a militia jeep and taken to an unknown destination," a Monrovia resident from the suburb of Gardnersville told AFP.
Human rights' groups have accused both sides of abuses against civilians - including killing, rape and torture, as well as forced conscription.
Fighting in Liberia has spilled over its borders into neighbouring Sierra Leone and Guinea and more recently into Cote d'Ivoire - home to thousands of Liberian refugees for more than a decade.
Liberian mercenaries, with their reputation for brutality and gross human rights' atrocities, are said to be fighting with both President Laurent Gbagbo's army and the rebels in the conflict across the border in Cote d'Ivoire.
On Wednesday, Taylor described in great detail what he called "savagery" perpetrated by the Lurd rebels. "People have been laid down and their throats cut, their stomachs opened and their hearts eaten," he said.
The causes of the continued civil strife in Liberia centre on battles for the control of precious natural resources, including diamonds, gold and timber. Ethnic divisions are another reason for continuing instability and enmity among the country's rival tribes.
Taylor launched a civil war in 1989, in which hundreds of thousands of people were killed and many more displaced and left homeless. Ecowas stepped in to try to end the conflict, sending in regional peacekeepers, known as Ecomog, who ended up having to enforce peace.
Taylor's rebellion ruined the Liberian economy and left the country without transport, running water or electricity. The one-time rebel leader emerged from the war he did not win as the victor of presidential elections eight years later.
Liberia was founded by freed American slaves in the 19th century. The Americo-Liberians, or 'Congos', ruled the country unopposed until 1980. In that year the late Samuel Kanyon Doe, a native Liberian and illiterate master-sergeant in the army, toppled the regime of the True Whig party, ending almost 150 years of Americo-Liberian rule.