LJUBODRAG, Macedonia Macedonia's troops and ethnic Albanian rebels resumed a battle on Saturday for control of Matejce village, latest focus in a month-old confrontation.

Artillery methodically shelled Matejce and two nearby villages, Slupcane and Otlja, part of a line of rebel-held settlements on the lower slopes of northeastern mountains 20km (13 miles) northeast of the capital Skopje.

Smoke billowed into the sky. Occasional bursts of automatic fire were heard.

Villagers of Ljubodrag, a Slav Macedonian village less than three kilometers (1.8 miles) away, used to the shelling, continued working on their fields.

"They bombard us with all types of weapons," a rebel commander who uses the name Shpati told Reuters by telephone. "We remain in our positions and respond to the fire."

Earlier on Saturday, the army said it came under fire through the night from guerrillas positioned in the mediaeval Orthodox Monastery above Matejce and in the village mosque.

"We fought a fierce battle yesterday which continued late into the night," army spokesman Blagoja Markovski told Reuters.

On Friday, security forces launched an assault on Matejce, once an ethnically mixed settlement.

Tanks and armored personnel carriers moved into the village and bursts of small and big calibre automatic fire came from the village the rebels infiltrated last week.

At least 8,000 mostly ethnic Albanian villagers have been trapped in the northeastern mountains since the latest bout of fighting began on May 3.

The village of Lipkovo, where most civilians are concentrated, sheltering in basements and cellars, has been quiet in recent days. Food and water is said to be in short supply.