The Islamic Courts Union has accused Ethiopia of sending combat troops to Somalia to aid the country's internationally-recognised, but weak, interim government.
Ethiopia has acknowledged sending military advisers to help train the government's small army based in the town of Baidoa, not far from Ethiopia.
"All our troops in the region are now ready at the front lines to face their enemy"
Mohamed Mohamud Agaweine, the military commander for the Islamic Courts Union in central Somalia
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The Islamic Courts say that they intend to topple the government and enforce Sharia law thoughout the country.
Ethiopia's government fears that the Islamic Courts intend to encourage millions of ethnic Somalis living in Ethiopia to revolt against the country's main Christian government.
On Saturday, Meles Zenawi, Ethiopia's prime minister, said he expected legislators to back a resolution giving him authority to use military force to defend Ethiopia.
He also said that Ethiopia would not seek approval from the UN security council nor any other body to defend itself militarily, saying it was Ethiopia's "sovereign right".
Ahemd Isse Gutaale, a reporter for HornAfrik, a local radio station in Mogadishu, said the Islamic Courts have repeated their calls for people to join their ""holy war" against Ethiopia.
"They were enrolling new volunteers and asked people to stand for the defence of their country," Gutaale said on Sunday.
Somalia has been without an effective central government since warlords toppled dictator Mohamed Siad Barre in 1991 and then turned on each other, carving much of the country into armed camps ruled by violence and clan law.