United States President Bill Clinton said he regretted that civilians in the convoy appeared to have been killed.

But he said Nato would continue its military campaign until Yugoslav President Slobodan Milosevic accepted the peace plan for Kosovo.

The BBC's Brian Hanrahan: Nato accepts responsibility for only one of the attacks on the refugees

Nato spokesman Jamie Shea said: "The refugees want Nato to continue its operations. And continue we will."

Nato planes attacked Yugoslav targets on Thursday with no apparent change in strategy.

Six blasts were heard in Montenegro's capital Podgorica from 1700GMT. Smoke was seen rising over a military airfield and anti-aircraft guns were reported to be in action.

(Click here for a map showing recent Nato strikes)

It was the first attack there for about a week, after Nato said it would avoid hitting targets in Montenegro if at all possible.

Serb media reported attacks in Serbia and around the Kosovo capital, Pristina, with explosions inside and outside the city.

Agency reports said that the port of Bar was also under attack.

BBC correspondents also reported three explosions near the northern Albanian town of Kukes, 25km from the Kosovo border and home to 80,000 refugees.

One of the explosions occurred on a hill outside the town, and two others were in the air.

Nato's admission came a day after Serb media said more than 60 refugees had been killed in at least two attacks in the south of the province.

However, Nato said it was only aware of one incident.

Nato leaders cast doubt on whether footage broadcast by Serb TV showed their attack or another incident, or incidents, elsewhere.

Accounts by refugees who said they had been bombed do not properly tally with Nato's description.

Jeremy Bowen meets survivors of the convoy

What happened elsewhere remains unclear - and the subject of heavy Serb propaganda.

Addressing American newspaper editors in San Francisco, President Clinton said Mr Milosevic had used his state media to manipulate the truth of what was going on in Kosovo.

'Bombed in good faith'

Nato said its attack involved one plane bombing one vehicle in a convoy.

John Simpson in Belgrade: The bombing is increasing President Milosevic's support

Mr Shea said an F-16 fighter pilot operating over western Kosovo saw villages being burnt in an area where Yugoslav special forces had recently been conducting ethnic cleansing.

Mr Shea said the pilot identified vehicles moving on the main road between Prizren and Djakovica, a route described by Nato as a key military supply corridor.

Hear the pilot talk through the bombing raid

"The bomb destroyed the lead vehicle which we now believe to have been a civilian vehicle."

"The pilot dropped his bomb in good faith, as you would expect of a trained pilot from a democratic country," he said.

"The pilot reported at that time that he had attacked a military convoy."

Mr Shea said Nato was taking more measures than any other force in combat history to minimise harm to civilians.

TV reports: Serb media have accused Nato of murder

But he stressed that even with the best military hardware available, there could never be a guarantee that there would not be tragic accidents.

"Sometimes one has to risk the lives of the few to save the lives of the many," said Mr Shea.

As Nato released details of the attack, Yugoslav authorities took Western journalists to the strike location.

The BBC's Mike Williams reported seeing wrecked vehicles and charred bodies lined up in a field. He says the deaths may not have been falsified but the scenes he saw were stage-managed.

• The Nato pilot's story
• Cook damns Belgrade's 'crocodile tears'
• German peace plan fails to enthuse
• Fog of war shrouds refugee deaths
• Images of the refugee attack