Backers of President Hosni Mubarak skirmished into the night on Wednesday with protesters demanding he quit, after what many saw as an attempted government backed crackdown on pro democracy demonstrations.
Mubarak promised on Tuesday to surrender power in September to try to defuse an unprecedented challenge to his 30 year rule, angering protesters who want him to quit immediately and prompting the United States to say change "must begin now".
A day later, the army told reformists to go home and Mubarak backers, throwing petrol bombs, wielding sticks and charging on camels and horses, attacked protesters in Cairo's Tahrir Square.
Anti Mubarak demonstrators hurled stones back and said the attackers were police in plainclothes.
The interior ministry denied the accusation, and the Egyptian government rejected international calls for Mubarak to end his 30 year rule now.
This apparent rebuff along with the spike in violence -- after days of relatively calm demonstrations -- complicated US calculations for an orderly transition of power in Egypt. In pointed comments, a senior US official said it was clear that "somebody loyal to Mubarak has unleashed these guys to try to intimidate the protesters".
Troops and tanks stood by as the violence raged. By nightfall on Wednesday, the protesters were still holding their ground in Tahrir (Liberation) Square, the hub for protests over oppression and economic hardship now into their 10th day. Skirmishes continued well into the night and there was sporadic gunfire, with blazes caused by firebombs.
But by about 3am (0100 GMT) on Thursday the square had calmed down somewhat, but with people from both sides still in the area. At least 145 people have been killed so far and there have been protests across the country.
United Nations human rights chief Navi Pillay said up to 300 people may have died.
Stop the bloodshed
Egyptian Vice President Omar Suleiman urged the 2,000 demonstrators bedding down in Tahrir Square to leave and observe a curfew to restore calm.
He said the start of dialogue with the reformists and opposition depended on an end to street protests. But protesters barricaded the square against pro Mubarak supporters trying to penetrate the makeshift cordon.
"This place will turn into a slaughterhouse very soon if the army does not intervene," Ahmed Maher, who saw pro Mubarak supporters with swords and knives, told Reuters.
Officials said three people were killed in Wednesday's violence and a doctor at the scene said over 1,500 were injured.
Reacting to the tumult in Egypt, White House spokesman Robert Gibbs said that, "If any of the violence is instigated by the government it should stop immediately."
Opposition figurehead Mohamed ElBaradei, a Nobel Peace laureate, called on the army to intervene to stop the violence. Urging protesters to clear the streets, the armed forces told them their demands had been heard. But some were determined to occupy the square until Mubarak quits.
Khalil, a man in his 60s holding a stick, blamed Mubarak supporters and undercover security men for the clashes.
"We will not leave," he told Reuters.
"Everybody stay put," he added.
"I'm inspired by today's events, however bloody and violent they are, and I will stay with my brothers and sisters in Tahrir until I either die or Mubarak leaves the country," said medical student Shaaban Metwalli, 22, as night closed in.
An opposition coalition, which includes the Islamist Muslim Brotherhood, called for more protests. It said it would only negotiate with Suleiman, a former intelligence chief appointed by Mubarak at the weekend, once the president stepped down.
The crisis has alarmed the United States and other Western governments who have regarded Mubarak as a bulwark of stability in a volatile region, and has raised the prospect of unrest spreading to other authoritarian Arab states.
President Barack Obama telephoned the 82 year old Mubarak on Tuesday to urge him to move faster on political transition.
"The message that the president delivered clearly to President Mubarak was that the time for change has come," Gibbs said, adding: "Now means now."
Secretary of State Hillary Clinton, in a call to Suleiman, underlined that US position.
But Mubarak dug in his heels on Wednesday. A foreign ministry statement rejected US and European calls for the transition to start immediately, saying they aimed to "incite the internal situation" in Egypt.
"This appears to be a clear rebuff to the Obama administration and to the international community's efforts to try to help manage a peaceful transition from Mubarak to a new, democratic Egypt," said Robert Danin, a former senior US official now at the Council on Foreign Relations think tank.