A looming confrontation between militants linked to al-Qaeda and government forces had residents of the Yemeni town of Rada'a in a panic Thursday, reported the Yemeni state-owned newspaper Al Jumhariya.
More than 200 armed radicals this week captured army positions and a famous castle in Rada'a, 150 kilometres south-east of the capital Sana'a, raising fears about al-Qaeda's expansion in the troubled Arabian Peninsula country, dpa reported.
Around 400 government soldiers were deployed around the town, as more insurgents poured in from other areas of the country, added the paper.
The town's residents accuse security authorities of collusion with al-Qaeda insurgents in an alleged bid to extend outgoing President Ali Abdullah Saleh's stay in power.
Saleh has previously portrayed himself as the only one who can keep the terror network at bay and has used this argument as a way to stay in power despite months of attempts - and an agreement signed by Saleh - to remove him from power.
"The state has given up its responsibility towards Rada'a," Sheikh Mohammed Naser, the head of an anti-Saleh group in the town, told the paper.
Rada'a is the closet town to Sana'a to be seized so far by al-Qaeda radicals after they captured several towns in the largely lawless south last year.
"What is taking place in Rada'a is to blame on Saleh's regime and family," he added.
Naser vowed that tribes living in the vicinity of the town would "not allow chaos to reign."
Tribal leaders in Rada'a were trying to coax the chief of the militants, Tariq al-Dahab, to quit the town peacefully, according to local sources.
Al-Dahab had pinned withdrawal from the town on the government's release of around 400 prisoners, including his brother, added the sources.
Al-Dahab is a relative of al-Qaeda's spiritual leader in Yemen, Anwar al-Awlaki, who was killed in a US airstrike last September.
Al-Qaeda extremists have taken advantage of the political turmoil, which has gripped Yemen since last February, to expand their influence.
Last November, Saleh signed a United Nations-sponsored agreement to step down after ruling the country for 33 years in return for immunity from prosecution.