Egyptian President Hosni Mubarak refused calls to step down, instead calling late on Friday for his cabinet to resign amid nationwide protests.
Thousands of demonstrators, who were in the streets all day and remained past midnight in central Cairo, demanded that Mubarak step down.
"I have asked the government to resign," Mubarak said in a televised, 11-minute speech.
A new cabinet would be named on Saturday, he said.
As many as 13 protesters were killed Friday in clashes with security forces, amid a tide of anger at Mubarak, who has held power for nearly 30 years.
"Down with Mubarak," protestors have chanted nationwide.
Friday's violence brings the death toll in this week's unrest to 27, including three officers from security forces.
The military, called out Friday to reinforce police, continued to patrol the streets with tanks and armoured vehicles as demonstrators defied the overnight curfew, ordered by Mubarak for Cairo, Suez and Alexandria but later extended nationwide.
In Cairo, protesters torched several police vehicles and stormed the foreign and information ministries. The headquarters of Mubarak's National Democratic Party party were looted and set ablaze.
In the hours following Mubarak's speech, demonstrators remained on the streets early Saturday, with a group of 20 to 30 men in one part of Cairo ransacking a neighbourhood NDP office and burning contents including plaques. Firing of tear-gas canisters could still be heard after midnight.
Mubarak said that he "regrets innocent victims on both sides".
He repeated promises to work toward improving Egyptians' standard of living, increase employment opportunities and improve health care.
Egyptians have been taking to the streets since Tuesday, demanding Mubarak's ouster.
Amid tear gas and armoured cars rushing through crowds to disperse protesters, a demonstrator told DPA on the street: "All people can die, to hell with us all - only Hosny Mubarak wants to live."
Saying he supports freedom of expression, Mubarak said that the protests had been made possible by the freedom allowed by the Egyptian government.
But the government has banned unauthorized protests and warned protesters that they would be dealt with swiftly.
More than 1,000 people have been arrested this week, with many more reportedly missing.
Citing the Health Ministry, satellite broadcaster al-Arabiya reported that more than 1,000 people had been injured in Friday's clashes.
Internet and mobile communications were cut Friday across Egypt, after social-networking websites used to organize protests were blocked earlier in the week.
One focus of the demonstrations has been corruption, which Mubarak vowed to curb in his Friday night speech.
"What happened during this protest supersedes chaos and puts into motion a plan to shake stability," he said.
Mubarak warned that other protests around the world have resulted in less stability. The government has long used stability as a rallying cry against calls for reform or change.
"I stand by the protection of Egypt's safety and stability," Mubarak said.
Friday's demonstrations had been planned to start after weekly prayers at mosques across the country. Security forces had tried to no avail to prevent rallies by blocking access to many mosques and potential demonstration sites.
Sajjid al-Badawi, head of the liberal Wafd opposition party, gave a press conference Friday night demanding a transitional government and changes to the Egyptian constitution.
World governments have weighed in heavily on the ongoing violence, urging peace and calm and calling on the Egyptian government to respect protesters' freedoms of speech and assembly.
The US threatened Friday to withhold aid to Egypt if President Hosny Mubarak's regime does not immediately halt violence against protesters and move toward introducing reforms.
This week's protests are the biggest in Egypt since bread riots in the 1970s.