Security forces fired tear gas to disperse hundreds of supporters of Alassane Ouattara in Abidjan [EPA]
Armed groups controlling northern Cote d'Ivoire claim they have seized a town in government territory and are heading south, raising the prospects of a return to civil war.
The fresh violence followed another night of clashes in the country's main city of Abidjan between forces loyal to Laurent Gbagbo, the incumbent president, and opponents who say he lost an election in November.
The UN and foreign governments have demanded that Gbagbo hand power to rival Alassane Ouattara, widely seen as the winner of the contest.
There were also reports of gunfire in the capital Yamoussoukro.
"I can confirm that we are now in Zouan-Hounien," Ouattara Seydou, a spokesman for the rebel New Forces, which support Ouattara, said,
He said the fighters were now in the process of moving towards Bin-Houin, a town from where they had been attacked by Gbagbo's forces.
An army spokesman said he had "no information" on any rebel movements in the west, near the border with Liberia.
The towns are small, remote and do not lie on a key axis, but the rebel announcement to have seized territory from Gbagbo's loyalists marked a significant escalation in a crisis which has turned increasingly violent this week.
Gbagbo has clung to power despite Ouattara being almost universally recognised as the winner of the presidential election.
Residents in Abobo, a pro-Ouattara stronghold of Abidjan which has seen the heaviest of three days of clashes, said shooting rang out early on Thursday after a night of relative calm.
The increasingly deadly tussle for control of the once prosperous state is the outcome of an election that was supposed to reunite it after a 2002-3 war, but has simply worsened divisions.
"The shooting has started again. We hear shots and explosions," Tiemoko Souala told the Reuters news agency by telephone from central Abobo. "It is difficult to put up with this fear."
A Reuters reporter on the road into Abobo saw scores of people streaming out of the neighbourhood to flee the fighting, which is in the northern outskirts of Abidjan, carrying suitcases and plastic bags of their belongings on their heads.
Another witness reported shooting on Thursday near an area called PK18 when a helicopter flew overhead, but said it did not last very long.
"We quickly returned to our houses. There is no one in the streets," said Abdoulaye Kone.
Heavy fighting erupted in Abobo on Wednesday afternoon, after pro-Gbagbo forces reinforced their presence there.
A military source said between 10 and 15 Gbagbo loyalists were killed in Abobo on Tuesday in an ambush by gunmen.
Fighting in west
A spokesman for the UN peacekeeping mission said the new outbreak of fighting in the western 18 Montagnes region was "very worrying".
"The UN thinks the clash poses a risk of armed conflict restarting ... which would have serious consequences for the Ivorian people and even the sub-region," Hamadoun Toure, spokesman for the UN peacekeeping mission in Cote d'Ivoire, said.
Well over 300 people have died in suppressed street protests and armed clashes since the power struggle began.
The economy has also ground to a halt as sanctions aimed at squeezing Gbagbo from power have hit ports and the cocoa industry.
The clashes this week came as African leaders charged with resolving the crisis held talks with Gbagbo and Ouattara, who remains holed up in a UN-protected hotel in Abidjan.
"I am going to see if I can leave the neighbourhood to go and stay in Yopougon [another neighbourhood] until this ends," Francois Kouakou, said. "I have never seen anything like this. I can't stay here."