Lebanese army tanks pounded the hideouts of a suspected al-Qaida-linked militant group in a determined attempt to rout them out after hours of clashes killed at least 22 soldiers and 17 militants.
It also underlined the difficulty authorities have in trying to defeat the country's armed groups that control pockets across Lebanon.
The conflict-ridden country was already in the midst of its worst political crisis between the Western-backed government and Hezbollah-led opposition since the end of the 1975-90 Lebanese civil war.
The army is stretched thin, having to frequently separate Shiite and Sunni Muslims rioters as well as rival Christian factions supporting the opposing political camps in Beirut. It has thousands patrolling southern Lebanon with U.N. peacekeepers and thousands more deployed along Syria's border to guard against illegal transfer of weapons.
Sunday's battle was the most serious fight the army had engaged in Lebanon in over a decade. Prime Minister Fuad Saniora said the fighting was a "dangerous attempt at hitting Lebanese security." Mainstream Sunni Muslim leaders, clerics and politicians threw their support behind the army, as did the Palestine Liberation Organization representative in Lebanon.
Security forces were able to quell the resistance in Tripoli after sundown Sunday, but it was unclear if the army would storm Nahr el-Bared, which like other refugee camps are off-limits to state authority, or keep up military pressure and force the militants to surrender.
The clashes between army troops surrounding the camp and Fatah Islam fighters began after a gunbattle raged in a neighborhood in Tripoli, a predominantly Sunni city known to have Islamic fundamentalists, witnesses said.
Fighting spread after troops and police raided alleged Fatah Islam hideouts in search of men wanted in a recent bank robbery. Militants burst out of the Palestinian camp, seizing Lebanese army positions, capturing two armored vehicles and ambushing troops, killing two soldiers on roads leading to the port city.
Security officials said 22 soldiers were killed, and 19 soldiers and 14 police officers were injured in the fighting - the worst violence to hit Tripoli in two decades.
They said 10 militants were killed when authorities stormed several buildings they were holed up in Tripoli, and seven more were killed in the refugee camp. Security officials said the militants had worn explosive belts but did not have time to detonate them.
The Lebanese Broadcasting Corp.TV station reported that among the dead militants were men from Bangladesh, Yemen and other Arab countries, underlining the group's reach outside of Lebanon.
Smoke billowed from the camp as a steady barrage of artillery and heavy machine gunfire from army positions pounded militant hideouts inside. Hundreds of Lebanese applauded the army's tough response of tanks, artillery and machine guns.
At the same time, a group of militants holed up in a building in Tripoli fought off army and police units for hours before finally losing the battle. The building remained partially on fire Sunday night, its staircase and entrance peppered with gunshots and rockets. About a dozen cars on the street were shot up or gutted. TV footage showed the bodies of dead militants amid the debris.
"We strongly back the Lebanese army troops and what they are doing," said Abed Attar, a Tripoli resident who stood watching soldiers firing tank shells into the camp while others cheered.
Long-standing tensions remain between some Lebanese and the estimated 350,000 Palestinians who have taken refuge in Lebanon since the creation of Israel in 1948. As a precautionary measure, Lebanese troops tightened security around other Palestinian refugee camps in the country.
Camp residents said at least 12 civilians were killed or wounded, but that figure could not be confirmed by Lebanese authorities, who have no presence there. Medical officials said 17 Palestinian civilians were wounded, with three women and four children in serious condition.
"We are living in a state of fear. The electricity was cut since 6 a.m., and the shelling is targeting civilians," said Khaled Najm, a Palestinian who spoke by telephone from inside the camp. "Those fighters came from abroad, and we are paying the price for their actions," he said of Fatah Islam.
The militant group is an offshoot of the pro-Syrian Fatah Uprising, which broke from the mainstream Palestinian Fatah movement in the early 1980s and has headquarters in Syria, Lebanese officials say.
Some Lebanese security officials consider Fatah Islam a radical Sunni Muslim group with ties to al-Qaida or at least al-Qaida-style militancy and doctrine. Other officials say they are a front for Syrian military intelligence aimed at destabilizing Lebanon.
It is believed to be led by Shaker Youssef al-Absi, a Palestinian who was sentenced to death in absentia in July 2004 by a Jordanian military court after being convicted of conspiring terrorism in a plot that lead to the assassination in Jordan of U.S. diplomat Laurence Foley. Al-Qaida in Iraq and its former leader Abu Musab al-Zarqawi were blamed for the killing.
A senior Lebanese security official said a high-ranking member of Fatah Islam, known as Abu Yazan, was among those killed Sunday.
Abu Salim, a spokesman for Fatah Islam in Nahr el-Bared, said on television that the militants were firing in self-defense.