|Al Jazeera's correspondent reporting from the Pearl Roundabout said "the crowds continue to grow"
A landmark junction in the heart of Bahrain's capital, Manama, continues to be occupied by opposition protesters, hundreds of whom spent the night there after another day of anti-government demonstrations in the tiny Gulf state.
Some woke early on Sunday morning in the Pearl Roundabout area and staged a noisy protest, chanting "Get out Hamad" as they pressed their demand that the king, Sheikh Hamad bin Isa Al Khalifa, should step down.
A small tent village has sprung up complete with stalls selling hot milk, scrambled eggs and tomatoes - catering to the hundreds who decided to stay overnight in the public square.
The protesters reclaimed on Saturday the junction that they had previously used as a focal point for pro-reform protests, but which was then violently taken back by security forces.
The calls against Sheikh Hamad and his inner circle are a recent escalation in Bahrain's political uprising, which began with calls to weaken the Sunni monarchy's power and address claims of discrimination against the country's Shia Muslim majority.
Abdul-Jalil Khalil, a leader of the main Shia political bloc, said on Sunday the opposition was considering the monarchy's offer for dialogue, but he noted that no direct talks were yet under way. Seven opposition groups said they would meet later in the day to co-ordinate a response.
They were responding after Bahrain's crown prince, Sheikh Salman bin Hamad Al Khalifa, who is also the deputy supreme commander of the country's armed forces, appealed for calm and political dialogue in a brief address on state TV on Friday.
On his orders, troops and armoured vehicles withdrew from Pearl Roundabout on Saturday, which they had taken over on Thursday after riot police staged a night-time attack on a sit-in by protesters, killing four people and wounding 231.
On Friday, army units shot at marchers streaming towards the square, injuring more than 50 people and preventing protesters from gathering there.
But after security forces withdrew, the protesters swarmed back to the square and confidently set up camp for a protracted stay.
As night fell on Saturday, the protesters erected barriers, wired a sound system, set up a makeshift medical tent and deployed lookouts to warn of approaching security forces.
Amid preparations for fresh rallies on Sunday, a general strike by opposition groups and workers' unions was called off, saying their demand for the right to protest peacefully had been heeded.
Teachers across Bahrain took part in the strike action, and many joined the protesters marching in the centre of Manama.
In an interview to CNN, Sheikh Salman said protesters would "absolutely" be allowed to stay in the Pearl Roundabout area.
"All political parties in the country deserve a voice at the table," he said of the proposed dialogue, adding the king had appointed him to lead it and to build trust with all sides.
"I think there is a lot of anger, a lot of sadness, and on that note I would like to extend my condolences to all of the families who lost loved ones and all of those who have been injured.
"We are terribly sorry and this is a terrible tragedy for our nation."
Barack Obama, the US president, has discussed the situation with Sheikh Hamad, asking him to hold those responsible for the violence accountable.
He said in a statement that Bahrain must respect the "universal rights" of its people and embrace "meaningful reform".
For his part, William Hague, the British foreign secretary, in a telephone call to Sheikh Salman, said he welcomed the government's military withdrawal and strongly supported efforts to initiate a dialogue.
The Bahraini demonstrators have emulated protesters in Tunisia and Egypt by attempting to bring political change to the government in Bahrain, home to the US navy's Fifth Fleet - the centrepiece of US efforts to confront Iranian military influence in the region.
Source: Al Jazeera and agencies