(WONG MAYE-E ~ Associated Press)
"I insist that what we are doing is necessary," Prime Minister Abhisit Vejjajiva said in a defiant broadcast on national television, making it clear he would not compromise. "The government must move forward. We cannot retreat because we are doing things that will benefit the entire country."
On Saturday, the protesters launched a steady stream of rudimentary missiles at troops who fired back with live ammunition in several areas around a key commercial district of Bangkok.
Army snipers were perched with high-powered rifles atop tall buildings, viewing the action below through telescopic sights. Thick black smoke billowed from tires set ablaze by demonstrators as gunfire rang out.
The spiraling violence has raised concerns of sustained, widespread chaos in Thailand -- a key U.S. ally and Southeast Asia's most popular tourist destination that promotes its easygoing culture as the "Land of Smiles."
"The situation right now is getting close to a civil war each minute," Jatuporn Prompan, a protest leader, told reporters. "Please don't ask us how we are going to end this situation, because we are the ones being killed."
Since Thursday, the once-bustling commercial and shopping district has become a war zone with Red Shirt protesters firing weapons, throwing homemade explosives, and hurling rocks at troops firing live ammunition and rubber bullets.
The violence ignited after the army started forming a cordon around the protesters' encampment and a sniper shot and gravely wounded a rogue general reputed to be the Red Shirts' military adviser.
At least 24 people have been killed and more than 194 wounded since Thursday. Previous violence since the protest began in mid-March caused 29 deaths and injured 1,640.
This is the most prolonged and deadliest bout of political violence that Thailand has faced in decades despite having a history of coups -- 18 since it became a constitutional monarchy in 1932.
The protesters have occupied a tire-and-bamboo-spike barricaded, 1-square-mile zone in one of the capital's ritziest areas, Rajprasong, for about two months to push their demands for Abhisit to resign immediately, dissolve Parliament and call new elections.
The crisis had appeared to be near a resolution last week when Abhisit offered to hold elections in November, a year early. But the hopes were dashed after Red Shirt leaders made more demands.
The political uncertainty has spooked foreign investors and damaged the vital tourism industry, which accounts for 6 percent of the economy, Southeast Asia's second largest.
Abhisit, in his first comments since Thursday, said the protesters have "held the people of Bangkok hostage" and described them as "armed terrorists" who attacked security forces.
"Officers on duty have the right to defend themselves," he said.
The Red Shirts, drawn mostly from the rural and urban poor, say Abhisit's coalition government came to power through manipulation of the courts and the backing of the powerful military, and that it symbolizes a national elite indifferent to the poor.
The fighting is taking place in the no man's land between the encampment and the army cordon, a normally bustling area with hotels, businesses, embassies, shopping malls and apartments. Most of them are now shut and public transport is off the roads.
The army said its cordon has been effective, and the number of protesters at the encampment has dwindled by half. Water and power also were cut off to the area Thursday.
About 5,000 hard-core demonstrators held their ground under threat of military operations to oust them, down from about 10,000 days earlier, army spokesman Col. Sansern Kaewkamnerd said.
"If the protesters will not end the situation, we will have to enter the encampment," Sansern said.
The army says it is not shooting to kill, but protesters crawled along sidewalks to slowly drag away corpses of three people near the city's Victory Monument traffic circle in the Ratchaprarop area. Demonstrators accused army snipers of shooting all three in the head.
On Saturday, soldiers unrolled razor wire across roads leading to Ratchaprarop -- a commercial district north of the main protest site -- area and pinned up Thai and English-language notices saying "Live Firing Zone" and "Restricted Area. No Entry."
Ratchaprarop houses high-rise buildings, posh hotels and designer shops. It was the scene of some of the worst fighting Friday night between troops and anti-government protesters.
Amid the violence, the rest of the capital has remained largely normal with shops, restaurants and cinemas open and busy, albeit with customers and workers expressing concern about the clashes. Rural Thailand also has not seen violence, though demonstrations and other protest-related activity has occurred in the rural home provinces of many Red Shirts and supporters.
The Red Shirts especially despise the military, which had forced Thaksin Shinawatra, the populist premier favored by the Red Shirts, from office in a 2006 coup. Two subsequent pro-Thaksin governments were disbanded by court rulings before Abhisit became prime minister.
"The reality is that this conflict also draws heavily on the frustrated political aspirations of a large numbers of rural voters," said Andrew Walker, a political scientist at The Australian National University.
"If election results are going to be overturned, people's political aspirations and frustrations will find expression in other forms," he said.
Defense Ministry spokesman Tarit Pengdit said 27 protesters have been sentenced to six months' jail for joining an illegal protest. He did not elaborate.
The U.S. Embassy said it will evacuate family members of its staff who want to leave Bangkok.
Embassy spokeswoman Cynthia Brown said the U.S. State Department also issued a "travel warning advising all citizens to defer travel to Bangkok."
Associated Press writers Thanyarat Doksone, Denis D. Gray, Grant Peck and Jocelyn Gecker contributed to this report. Additional research by Warangkana Tempati.