The Democratic Republic of Congo has accused Rwanda of sending troops to support rebel soldiers who have seized the Congolese border town of Bukavu.
Kinshasa says Gen Nkunda is receiving orders from Rwanda
DR Congo President Joseph Kabila said Bukavu was "under the control of Rwandan occupants", and told the BBC it was "a situation of war".
Rwanda has denied any involvement in the conflict in eastern Congo.
The AP news agency quotes rebel leader Brig Gen Laurent Nkunda as saying that his forces will withdraw from Bukavu.
He said that he had already ordered 300 fighters to leave and the rest would depart later on Thursday.
"We shall withdraw to reorganization centres to assure the transitional government that we are not opposed to it," Gen Nkunda said.
"We are just opposed to the persecution of one section of the Congolese community."
The fighters are from a former Rwanda-backed rebel group, that was supposed to join the national army.
Gen Nkunda and other renegade commanders - ethnic Banyamulenges, related to Rwandan Tutsis - say government forces have been attacking members of their community.
In the capital, Kinshasa, there has been a second day of violent protests against the UN's failure to stop the rebels taking Bukavu.
The BBC's Arnaud Zajtman says that students have again set fire to UN vehicles.
Additional United Nations peacekeepers were sent to Bukavu last week, following fighting between the dissidents and regular troops.
But the UN troops did not oppose the advancing rebel fighters, saying they did not have a mandate to "make war".
In the capital Kinshasa, President Kabila on Wednesday said: "It is clearly an attack on our country by Rwandan troops.
"The army is mobilising with the objective of retaking control of Bukavu."
The UN said Rwandan troops had been spotted in DR Congo north of Bukavu six weeks ago, although they were all supposed to have left as part of last year's peace deal.
But Rwanda has flatly denied any involvement in DR Congo.
"The town of Bukavu is currently occupied by the United Nations forces," Rwanda's Great Lakes envoy Richard Sezibera told the BBC's Newshour programme.
However, Foreign Minister Charles Muligande said that Rwanda would intervene to oppose "genocide".
Latest reports from the town speak of looting and rape, despite efforts by UN peacekeepers to maintain order.
Civilians looted two barges loaded with 300 tonnes of food aid on Wednesday, said Ndeley Agbaw, head of the World Food Programme office in Bukavu.
UN peacekeepers have not engaged the rebels
UN officials say that Gen Nkunda has at least 2,000 men under his control - up from 500 just two weeks ago.
They are reinforcing Col Jules Mutebusi, whose militia first clashed with the army last week.
A week of clashes has left at least 27 people dead, and thousands of Banyamulenge have fled into Rwanda.
Both Col Mutebusi and Gen Nkunda are former members of the largest rebel group, the RCD, which controlled all of eastern DR Congo during the five-year war.
Under a peace deal agreed last year, all the Congolese warring factions were supposed to unite as a single army, but progress has been slow.