BBC Correspondent Paul Wood: "Refugees continue to leave."

The new moves came as thousands of ethnic Albanian refugees continued to flee a Serbian offensive in the province, crossing into Albania, Montenegro and Macecdonia.

Talks between ethnic Albanians and Serbian Government representatives failed to go ahead as expected on Friday.

Gelbard: "disproportionate and indiscriminate"

Ethnic Albanian leaders in Kosovo accused the Serbs of laying siege to Kosovo and of attempting "ethnic cleansing".

The United States said it was trying to reinstate the talks through its Ambassador to Macedonia, Christopher Hill, who has been appointed as a "facilitator" and sent to Kosovo.

But the US special envoy for the Balkans, Robert Gelbard, said they were "seriously jeopardised by Belgrade's disproportionate and indiscriminate use of force in response to violence from Albanian extremists."

Ethnic Albanian talks negotiator Veton Surroi : "We are at the beginning of the Bosnian War again."

Referring to the latest violence, Mr Gelbard said: "What we have seen is something that, based on the refugee accounts, sounds an awful lot like ethnic cleansing as they've been trying to drive people out of Kosovo into Albania."

Former British Nato ambassador Sir Michael Alexander: "The dilemmas are acute."

He said the talks were "extremely fragile" but the aim was "a package of measures to stop the fighting, draw back the forces and see if we can put into place some very robust confidence-building and tension-reducing measures."

Nato response

Concern is growing over the reported Serb use of heavy artillery

Nato is considering a military response to the crisis, the UK Defence Secretary George Robertson, has confirmed.

Nato defence ministers are meeting next week in Brussels to consider the crisis and Mr Robertson said Kosovo would be at the top of the agenda.

He declined to describe the military options under consideration but said pressure would be put on the Yugoslav President, Slobodan Milosevic.

George Robertson: "Military options not ruled out."

"The full power of Nato is considering all options, including the most radical," Mr Robertson told BBC Radio 4's Today programme.

"We are examining very carefully military options that could and might have to be made available.

Nato spokesman Jamie Shea: "NATO has learned the Bosnia lessons rather well"

"We are giving the clearest possible signals through political, military and economic pressure that Mr Milosevic must stop and think, must look at other alternatives, and look for a peaceful and political solution to the problems that exist."

Contact Group

Ethnic Albanian refugees arrive in Albania after fleeing the fighting

Britain has called an emergency meeting of the Contact Group of major powers in London on June 12 to discuss the escalating fighting and refugee exodus.

The Austrian Foreign Minister, Wolfgang Schuessel, is holding talks in Serbia.

The Contact Group comprises the United States, Britain, France, Germany, Russia and Italy.

The UK Prime Minister, Tony Blair, said the world needed to send the "strongest possible signal" to the warring parties.

Albania, which has received thousands of ethnic Albanians from Kosovo, has called for international action to stop an open war in the province.

Sanctions lifted

Last month, the Contact Group lifted some sanctions against Belgrade after President Milosevic agreed to regular meetings with Kosovo's ethnic Albanians to try and broker a peace deal for the province.

But the co-ordinator of the Kosovo Albanian team picked recently to negotiate with the Serbs said it was impossible for any meetings to be held.