The Liberian army and rebels are engaged in fierce fighting in the strategic town of Tubmanburg, captured by rebels earlier this week.

However, reports that the rebels were on the outskirts of the capital, Monrovia, have proved to be a false alarm.

The BBC's Jonathan Paye-Layleh says the panic was caused by soldiers firing their guns in the air as they headed for Tubmanburg, 60 km to the north-west.

President Charles Taylor has arrived back from the African Union meeting in Addis Ababa amid tight security at the airport and immediately appealed for calm.

He also accused the rebels from the Liberians United for Reconciliation and Democracy (Lurd) of carrying out atrocities against the population of Tubmanburg.

Following the sound of gunfire at the strategic Po River Bridge, 12km outside Monrovia, thousands of civilians fled their homes.

Lurd has been trying to overthrow the government of President Charles Taylor since 1999.

'Stage-managed'

Our correspondent says government soldiers have now reached the centre of Tubmanburg.

Chief of staff General Kpengba Konah has ordered all soldiers to report for duty "in the interests of the nation".

The French news agency, AFP, reports some people being forcibly conscripted.

The latest fighting caused panic in Monrovia

"Six youths who were playing football in our area were forced into a militia jeep and taken to an unknown destination," Philip Tamba, a resident of Monrovia's Gardnersville area told AFP.

On Tuesday, Mr Chea confirmed that rebels had recaptured the iron-ore rich town of Bopolu, situated approximately 100km north-west of the capital.

He also said that at least six government soldiers had been killed in the fighting.

Several vehicles, including jeeps loaded with armed men, some carrying calibre machine guns, were seen heading towards the area.

Last time the rebels were in Tubmanburg, it took the government six months to push them out.

Our correspondent says that some Monrovia residents believe that the attacks are stage-managed in order to create fears and insecurity among exiled opposition politicians returning home to take on Mr Taylor in the 14 October general elections.