Georgia's breakaway South Ossetia region has witnessed another night of heavy shelling, leaving a ceasefire deal signed on Friday in tatters.
Georgia wants to bring the rebel region back into the fold
Georgia says one of its soldiers died and three were wounded in the latest fighting with South Ossetian forces.
Much of the fighting centred on a vital access road in the region that links nine ethnic Georgian villages, the BBC's Sarah Rainsford reports.
South Ossetia broke away from Georgia in 1992 following an 18-month conflict.
Georgian Prime Minister Zurab Zhvania has proposed direct talks with the South Ossetian President, Eduard Kokoiti.
Population: About 70,000
Major languages: Ossetian, Georgian, Russian
Major religion: Orthodox Christianity
Currency: Russian rouble, Georgian lari
Mr Kokoiti has refused such a meeting in the past whilst Georgian soldiers remain in the region.
The US state department has called for restraint and a return to political dialogue.
The Georgian interior ministry has now pledged to pull out one-third of its troops if the situation remains calm for several days.
On Monday President Kokoiti called the fighting a well-planned provocation by Georgia but he insisted he was still willing to search for a compromise.
Many South Ossetians want to join up with their ethnic brethren in North Ossetia, which is part of Russia.
As part of the ceasefire deal, the two sides had agreed to create additional buffer zones between their positions.
These would have been patrolled by Russian peacekeepers and monitored by the Organisation for Security and Co-operation in Europe (OSCE).