Recent fighting in eastern Sri Lanka has closed more than 100 schools, with some turned into camps to accommodate displaced people, officials say.
The military denies involvement with Col Karuna's faction
They say that the fighting has crippled daily lives of residents in the area.
Teachers say that rocket strikes are terrifying pupils, whose parents are now reluctant to take them to school.
On Wednesday, the air force launched its third consecutive day of attacks on suspected rebel jungle positions. The number of casualties is not known.
"Multi-barrel rockets are fired from the grounds opposite the school. The deafening sound terrifies the pupils," the head teacher of Vincent Girls School, Subha Chakrawarthi, told the BBC from the eastern town of Batticaloa.
"Teachers find it difficult to work," she said, "and when the first barrage of firing happened, two girls collapsed. They lost consciousness. We had to take them to hospital.
Fighting has been escalating in eastern Sri Lanka
"Many children have now stopped attending school. Some come and take their children home as soon as they hear the shelling."
The director of Batticaloa Teaching Hospital, S Muruganantham, has a similar story.
"Many patients are terrified of the noise," he said, "they complain that they are having chest pains due to the shelling. Sometimes the attacks happen during the night.
"Even newborn children are terrified. They don't sleep at night. The tremors from the bombing has shattered the glass in the hospital.
"Many staff are also afraid to come to work."
Residents living near the army camp in Batticaloa say that in addition to the military's offensive, there is the threat of Tamil Tiger counter-attacks, with the possibility of mortar and artillery shells falling on their schools, hospitals or homes.
Officials estimate that 73 schools have also closed down in areas controlled by the rebels, and that the education of 24,000 children has been affected throughout the east.
Meanwhile a report by the human rights group, Amnesty International, says that armed groups are abducting displaced people from increasingly crowded camps in the east.
Amnesty say that some of those carrying out the abductions are men under command of the renegade former Tamil Tiger commander, Col Karuna.
Thousands of families have been displaced in the east
"We are hearing reports of armed men, wearing the uniforms of the Karuna faction, roaming the camps and even distributing relief goods," Purna Sen, Amnesty's Asia Pacific director, said in a statement.
Col Karuna split from the Tamil Tigers in 2004. Since then his forces have clashed regularly with the rebels, and there have been reports that the military is backing them.
"The Karuna faction appears to operate throughout Batticaloa town with the complicity of the Sri Lankan authorities," Ms Sen said.
But the military denies involvement with the breakaway group. A statement issued by the defence ministry said that no armed personnel other than government-commanded security forces are allowed in the camps.