Serbia says its forces have wiped out what it called a large terrorist group in the troubled province of Kosovo.

A government statement said the clashes began when ethnic Albanians fired on Serbian forces on a main road in the west of the province, killing a policeman.

It's not known how many Albanians died.

The latest Serbian offensive against the separatist Kosovo Liberation Army has sent at least two-thousand people fleeing across the border into northern Albania, with thousands more said to be hiding in the hills. . The Albanian prime minister, Fatos Nano, in a statement broadcast on televison, said it was time to reconsider its policy towards those involved in the crisis and described those taking up arms as acting in self-defence.