Islamist fighters in Somalia's capital, Mogadishu, have advanced to the edge of the presidential palace in some of the fiercest clashes in months.
Pro-government forces have been locked in battle with radical guerrillas and 25,000 civilians have reportedly fled.
Sources say the government's leadership is crumbling and many of its troops have defected to the rebels.
Our correspondent says Mogadishu has seen plenty of fighting over the years but this appears on a different scale.
Wednesday's fighting focused near the presidential palace in the Wardigley district and in the north of the city at the Bondere and Karan areas.
West's worst nightmare
It is estimated more than 120 lives have been lost since a combined force of militant Islamic groups, al-Shabab and Hisbul-Islam, launched an offensive at the weekend.
Now they have boxed in the government forces and African Union (AU) troops supporting them to a narrow pocket of territory inside the capital.
Military and intelligence sources say it is by no means certain the fragile Western-backed interim government can defend itself, according to BBC East Africa correspondent Peter Greste.
If not, Somalia becomes the West's worst nightmare: A strategically placed country under the control of Islamic militants with links to al-Qaeda.
One assessment reckons the government, which has been fighting radical Islamists for three years, can only count on some 4,000 fighters against 6,000 from al-Shabab.
Foreign radicals
Many of the guerrillas are well-trained foreign radicals with reinforcements expected in the next day or so, says our correspondent.
A moderate Islamist president took office in January but even his introduction of Sharia law to the strongly Muslim country has not appeased the guerrillas.
Meanwhile, the UN special representative for Somalia said the international community must do something.
Ahmed Ould Abdallah told a meeting of the AU in neighbouring Ethiopia: "What we have in Somalia is a government - weak, fragile - but it is a government and we have a moral, political obligation to help it."
The AU announced a boost for its under-resourced peacekeeping effort in Mogadishu - with the surprise offer of a battalion from Sierra Leone.
Although the mission has been able to keep the port and airport open it has been unable to stop the fighting or provide more than very limited protection to civilians.
The UN meanwhile warned that drought had left nearly half the Somali population malnourished and some 3.2 million people in urgent need of food aid.
The Horn of Africa nation of an estimated nine million has experienced almost constant conflict since the collapse of its central government in January 1991.
It is estimated that more than 16,000 civilians have been killed by fighting since the start of 2007 and more than one million are internal refugees.
Source: BBC
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