Sri Lanka's Jaffna peninsula has seen more heavy shelling and artillery fire as government forces and Tamil Tiger rebels battle for control of key areas.
The violence has been building in recent months
The military said it had repelled a rebel offensive which broke through army lines in Jaffna on Saturday.
Some 60,000 people have fled the fighting, while another 10,000 are caught between the two sides.
Despite the fighting, the government has said it is ready to respond to a reported rebel offer to revive talks.
The rebels conveyed a message that they were considering talks through the Nordic ceasefire monitoring mission on Friday evening.
After being told of the offer, the government "gave a very positive answer and we said we will start talks immediately", Palitha Kohona, the chief of the government's peace secretariat, told the Associated Press news agency.
The mission's spokesman, Thorfinnur Omarsson, said the Tigers had called to request renewed talks and had promised to follow up with a formal, written offer which they were still waiting for.
The BBC's Dumeetha Luthra in Colombo says the general consensus is that the Tigers started the latest bout of fighting in the north.
She says analysts see the phone call as a diversionary tactic rather than a sincere consideration, designed to depict the Tigers as peacemakers rather than the aggressors.
On Sunday, the military said the Tamil Tigers had launched a sea attack against islets just south of Jaffna town.
Soldiers called in air support and say they forced the rebels to retreat after 20 minutes of intense clashes.
Saturday saw casualties on both sides
There has also been heavy shelling close to the dividing lines between government and Tiger-controlled areas of Jaffna.
Thousands of government soldiers are stationed on the isolated peninsula, which is cut off by rebel territory and accessible only by the sea.
Truce monitors, quoted by the Reuters news agency, said they believed the Tamil Tigers were trying to cut supply lines to Jaffna, which has changed hands several times over the past two decades.
The latest fighting follows a day of heavy artillery exchanges during which both sides said they had taken or recaptured territory.
The two sides also blamed each other for sparking the fighting, which the government on Saturday said had left 27 soldiers and more than 100 rebels dead.
As well as Jaffna, Trincomalee in the north-east and Batticaloa in the east saw fighting on Saturday.
Trincomalee was reported quiet on Sunday but local sources said there was fighting around Batticaloa as the army tried to break through Tiger lines.
The flare-up in fighting has alarmed Sri Lanka's key foreign donors who called for an immediate end to the hostilities, which they said was "seriously unravelling" the 2002 ceasefire agreement.
They also expressed serious concern about the humanitarian situation.
There has also been violence away from the front lines.
On Saturday, a senior government peace official, Ketheesh Loganathan, was shot dead in the capital, Colombo.
He was the deputy head of the government's peace secretariat, which co-ordinates the Norwegian-brokered peace process between the government and rebels.