"The Palestinian refugees are not being treated properly by Lebanon"
Sunny, Ottawa, Canada
Send us your views
Al Jazeera's Zeina Khodr said that the Lebanese army is expected to carry out a limited military incursion later in the day.
She said the army hopes to put an end to fighting by the end of the day.
Smoke billowed from breeze-block buildings inside the camp, television footage showed.
The conflict is Lebanon's worst internal fighting since the 1975-1990 civil war.
So far it has killed at least 83 people, including 34 soldiers, 29 Fatah al-Islam fighters and 20 civilians.
A Lebanese soldier was killed and three others wounded in clashes on Thursday.
The government is demanding that the men surrender, and the authorities have already charged 20 captured members of the group with "terrorism". The charges carry the death penalty.
Lebanon's government has given Palestinian leaders in Lebanon a chance to find a way out of the two-week stand-off because it fears the fighting could spread to other refugee camps.
Abbas Zaki, the Palestine Liberation Organisation (PLO) representative in Lebanon, urged the fighters to surrender.
More than 25,000 of the Nahr al-Bared's 40,000 Palestinians have fled to the nearby Beddawi camp, where humanitarian organisations have been carrying out relief work.
Members of Lebanon's anti-Syrian cabinet have described Fatah al-Islam of being a tool of Syrian intelligence, though Damascus denies denies this and says its leader, Shaker al-Abssi, is on Syria's wanted list.
Al-Abssi has said he follows al-Qaeda's ideology, but has no direct links to Osama bin Laden's network. Many of his estimated 300 gunmen are believed to have fought in Iraq.
The Lebanese authorities say Fatah al-Islam includes Arabs from Saudi Arabia, Algeria, Tunisia, Syria and Lebanon.