Heavy shelling rocked the Somali capital on Sunday, raising fears of more civilian casualties, as fighting between Ethiopian forces and Islamist insurgents entered its fifth day.
As rival forces exchanged artillery after a night of sporadic battles, demolishing buildings, dozens of dismembered bodies lay rotting in the battle zone in northern and southern Mogadishu.
Highlighting the regional fallout over resolving the Somali conflict, Eritrea pulled out of the east African peacemaking bloc IGAD, after a disgreement with Ethiopia over the fighting in Somalia.
Asmara and Addis Ababa has been trading accusations of fuelling the conflict.
"We can see Ethiopian tanks firing artillery and mortar shells towards civilian areas. They are firing indiscriminately and the mortars are landing everywhere," said Abdulkarim Ali, a resident of southern Mogadishu's Gupta area.
Ali said at least four people, including a child, were wounded in the shelling that was heavy around the fortified presidential palace, known as Villa Somalia, as well as the main Bakara market.
The battles that flared up Wednesday have claimed the lives of at least 168 civilians and wounded hundreds others, according to Elman Peace and Human Rights Organisation, a local group that tracks casualty figures.
But residents said the toll could be much higher as many battlefields are still inaccessible.
An AFP correspondent said mutilated bodies lay rotting in the battlezone as shooting barred residents from collecting them for burial in line with Muslim traditions.
"The fighting is going on heavily in this area. Both sides are using machine guns and anti-aircraft guns and many people are trapped in their houses," said Mukhtar Mohamed, a resident of Fagar in northern Mogadishu.
"May Allah save us because He is the only one who knows when this fighting will end," he said, adding that casualties were "apparently increasing in this neighbourhood and people are fleeing."
Four days of fighting earlier this month claimed at least 1,000 lives in clashes that were described as the worst bloodletting in the country since after the 1991 ouster of dictator Mohamed Siad Barre.
The United Nations says at least 321,000 people have fled Mogadishu since February. Many are camped under trees and makeshift hovels in the city's outskirts, without supplies and where disease outbreak have been reported.
On Sunday, hundreds of terrified civilians continued filing out of the blood-soaked capital, carrying few items as the artillery duels showed no sign of let up.
Prospects for a ceasefire were shattered last week after the Ethiopian forces refused to meet elders from Mogadishu's dominant Hawiye clan until commanders of the insurgency would be present.
But the elders have blamed the Ethiopians of planning to fight until they wipe out the insurgency and create a secure environment for the embattled government.
Ethiopian troops helped Somalia's UN-backed transitional government to oust Islamists from Mogadishu in January. But since then fighting has steadily grown worse as Islamist insurgents and clan warlords have vowed to wage a guerrilla war to oust the Ethiopians.
Eritrea withdrawal from the Inter-Governmental Authority on Development (IGAD), which supports the deployment of Ethiopian and African Union troops in Somalia, further complicted the regional efforts to end the war.
"The government of Eritrea was compelled to take the move due to the fact that a number of repeated and irresponsible resolutions that undermine regional peace and security have been adopted in the guise of IGAD," the Eritrean foreign ministry said in a statement.
"As such, the Eritrean government deemed it fit not to be party to developments that hold one accountable both legally and morally."
African watchers have expressed fears that Ethiopia and Eritrea, still at odds over their unresolved 1998-2000 border conflict, may be fighting a proxy war in Somalia.
Some 1,500 African Union peacekeepers from Uganda, who have deployed in the seaside capital since early March, have been unable to stem the escalating violence.
The Ugandans are an advance contingent of about 8,000 peacekeepers the AU plans to deploy to help Somali President Abdullahi Yusuf Ahmed to extend his tenuous hold on the country.
Somalia has lacked an effective government since Barre's ouster touched off a deadly power struggle that exploded into inter-clan warfare, defying more than 14 attempts to restore stability.