The rebel Liberation Tigers of Tamil Eelam (LTTE) said about 2,000 men, women and children fled their homes in the district of Mannar, where heavy fighting has raged since Thursday.
Unidentified gunmen shot dead five civilians -- three in the north and two in the east -- on Sunday afternoon, police said, adding the victims were villagers who had supported the ruling party government.
One government soldier was killed and three more wounded in Mannar district in the latest shelling, the defence ministry said Sunday. It said troops retaliated in kind and inflicted unspecified casualties on the guerrillas.
The ministry estimated that at least 49 Tiger rebels were killed in the latest fighting. The military placed its own losses at 10 dead and 46 seriously wounded, with another 45 listed as minor casualties.
The LTTE said it lost 13 combatants and claimed to have killed 60 government troops. Both sides are known to overestimate losses suffered by the other.
Thousands of civilians living along the de facto border separating Tamil Tiger territory from the rest of the island fled to the safety of public buildings to avoid shelling by both sides, local officials said.
They said about 300 civilians had crossed the front lines Saturday and entered government-held areas, where they were provided with food by government troops.
The Tigers said the refugee crisis in Mannar had compounded problems for relief workers already grappling to feed nearly 300,000 internally displaced people in the island's embattled regions.
The rebels on Sunday accused the army of planting a roadside bomb that killed a local aid worker and wounded three others when it exploded near their vehicle in Mannar on Saturday.
"This is the work of the Sri Lankan army's deep penetration unit," LTTE spokeswoman Navaruban Selvy said by telephone from her office in the rebel-held town of Kilinochchi, about 300 kilometres (200 miles) north of the capital.
"The victims were trying to arrange relief for civilians displaced as a result of the latest fighting."
The worker was a volunteer with the Tamils' Rehabilitation Organisation, a local charity that operates refugee centres and distributes aid in rebel territory.
Sri Lanka's military denies carrying out bomb attacks inside rebel-held territory, but military sources have acknowledged that small groups of troops are operating behind rebel lines.
The report of the blast came as the defence ministry said it had killed two suspected Tamil Tiger rebels in the northern peninsula of Jaffna, to the north of Mannar, on Saturday.
In the east of the island, police recovered the bodies of six suspected Tiger rebels killed by troops in a confrontation over the weekend and a magisterial inquiry was held on Saturday, police said.
More than 4,000 people have been killed in a wave of fighting in Sri Lanka since December 2005. The violence comes despite a truce in place since February 2002.
The LTTE has been waging a 35-year campaign for an independent homeland for Sri Lanka's Tamil minority in this majority Sinhalese nation.
aj/jc AFP 251302 GMT 03 07
