Tamil Tiger sources said the heavy fighting erupted when the Sri Lankan Army (SLA) launched a fresh offensive on Wednesday morning.
"LTTE defensive formations were confronting the SLA units that mounted offensive attacks simultaneously at several locations around 3:30 am.," said the pro-rebel website tamilnet.com, quoting the Tigers' Northern Forces Operations Command.
The Tigers have not commented on the number of casualties and independent verification is not possible as the media are barred from the war zone.
The Tigers, who are fighting for an independent state in the north and east, said in a statement earlier that they had repulsed another government assault in Jaffna on Tuesday.
Rasiah Ilanthiraiyan, a Tamil Tiger spokesman said, "At Muhamalai front in Jaffna, heavy clashes erupted when the SLA battle units made an attempt to overrun LTTE fortifications."
Analysts say both the government and the Tamil Tigers often inflate enemy death tolls and play down their own losses.
Mahinda Rajapaksa's, Sri Lanka's president, has pledged to destroy the Tigers militarily by the end of the year.
Last year government troops drove out Tigers from the island's east and are now focusing on Tiger-held territory in the north.
The civil war has killed an estimated 70,000 people since 1983, with thousands killed in recent months.
The separatists have hit back with bombings in Colombo and elsewhere in the relatively peaceful south of the island when they have come under military pressure in the past.
Analysts say the military has the upper hand in the latest phase of the war, given superior air power, strength of numbers and recaptured terrain.
Despite high security and military gains, they say the Tigers still retain the capability to strike back.