Russia accused Georgian troops of opening fire first and denied responsibility for any of the killings.

But Moscow also refused calls from Tbilisi for either international negotiators or observers to get involved in the conflict, as it tries to fight off the growing presence in the region of the United States, which is training Georgian troops and helping build a strategic pipeline in the Caucasus.

Georgia's Rutsavi 2 television report of the deaths could not be immediately confirmed, but it reflected a rise of violence in an impoverished region of the former Soviet republic that was broken up by a series of civil wars linked to ethnic ties more than a decade ago.

The latest unrest comes as Georgia's new leader, President Mikhail Saakashvili, tries to regain control over his state after leading a bloodless revolution that now sees Tbilisi turning toward the West but with some of its regions still showing allegiance to Russia.

Amid the renewed shelling and gunfire, Russian and Georgian officials suggested that a third force -- one which was not loyal to either party -- was present in South Ossetia in order to try to spark a conflict.

The comments suggested that Tbilisi and Moscow may be trying to reach a compromise in the tense Caucasus standoff, media and analysts said.

"Today military from both sides looked for the so-called 'batmen' in the conflict zone," said Lev Mironov, a Russian representative in a joint commission trying to mediate the conflict.

"They need to be captured by joint efforts and be put behind bars or destroyed," Mironov said.

Georgian Defense Minister Georgy Baramidze appeared to agree.

"There is a well-prepared armed group of about 15-20 people in the conflict zone -- the South Ossetian side agrees with this. During the night they shoot at positions of both sides, trying to provoke all-out war."

But the South Ossetians said this unnamed force was made up of Georgian troops.

"There is a third side that wants war and we must neutralize them together with Russian peacekeepers," said South Ossetian representative Boris Chochiyev.

The spiraling violence has prompted Saakashvili to call for international peacekeepers to provide security for civilians and ensure that conditions for talks on a permanent settlement were met.

The latest series of clashes also led to a telephone conversation between US Secretary of State Colin Powell and his Russian counterpart Sergei Lavrov.

The Russian foreign minister said earlier on Wednesdsay that "we see no reason for creating a new forum of negotiations," referring to Tbilisi's call for Western intervention.

Repeated fighting has undermined a ceasefire signed late last week between Georgia, Russia and South Ossetia and the Organization for Security and Cooperation in Europe, in an intense drive to defuse the crisis in the region.

Inhabited mainly by ethnic Ossetians, South Ossetia has enjoyed de facto independence after an armed conflict with Tbilisi following the break-up of the Soviet Union in 1991.

Georgia also has another separatist region, Abkhazia, which also declared independence from Tbilisi after a brutal civil war in the early 1990s.

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