The Sri Lankan air force has bombed targets in Tamil Tiger-held areas in the north for a second day.
The Tigers released this photo of damage to the hospital
International ceasefire monitors said five people, probably civilians, were killed when a bomb landed near a hospital in the town of Kilinochchi.
The army says the planes were attacking two military targets.
The air raids are the first since weekend peace talks broke down on the issue of the main road linking Jaffna with the rest of the country.
Both sides accuse each other of restarting the fighting.
Staff from the Sri Lanka Monitoring Mission (SLMM) visited Kilinochchi - where the Tamil Tigers have their headquarters - to assess the damage.
SLMM spokeswoman Helen Olafsdottir said that the hospital had not been struck, but had been damaged by shock waves from the blast.
DESCENT INTO VIOLENCE
16 October 2006: 99 killed in suicide attack on navy convoy
11 October 2006: 129 soldiers die in fighting between army and Tamil Tigers
4 September 2006: Troops take control of a crucial area near Trincomalee
14 August 2006: 61 schoolchildren killed by air force bombs, rebels say
7 August 2006: 17 local employees of a French charity shot dead in the town of Muttur
26 June 2006: A suspected suicide bomber kills a top Sri Lankan general near Colombo
15 June 2006: At least 64 - many children - die in mine attack on bus
Two bombs had been dropped, she said, one of which landed on a house 600m away from the hospital, the other about 400m away.
Ms Olafsdottir said the dead included two teenagers and two people in their 50s or 60s.
"It seems at first sight that these were civilians but we need confirmation," she told the BBC.
A statement from the rebels said those killed were five members of one family who died in their house.
Tiger military spokesman Rasiah Ilanthiraiyan told Reuters news agency that fragments from the blast "flew as far as a hospital 500 metres away and smashed windows".
"This is state terrorism," he said.
But the military said it was attacking legitimate targets.
"We have taken two targets. One is a Sea Tiger base in Mannar [in the north-west], and the other is a military training camp 10km south-east of Kilinochchi," said military spokesman Brigadier Prasad Samarasinghe.
The air raids came as the two sides continued artillery exchanges in the north and east for a fourth day.
On Wednesday jets pounded the restive eastern district of Batticaloa.
"The situation is discouraging and the talks in Geneva did not have any positive impact on the ground situation," Ms Olafsdottir told the Associated Press news agency.
The violence has claimed more than 3,000 lives since the end of last year, the government says, although the rebels dispute the number of their fighters killed.
Both sides maintain that they are committed to a 2002 ceasefire.
At least 65,000 people have been killed since the rebels began their fight more than 20 years ago for a homeland for minority Tamils in the north and east.
The rebels say Tamils have been discriminated against by the island's majority Sinhalese community.