Thousands of civilians are fleeing the fighting
The International Committee of the Red Cross (ICRC) is evacuating 240 sick and wounded civilians who had been trapped by fighting in north-east Sri Lanka.
An ICRC spokeswoman told the BBC the evacuees were being taken by ferry to the city of Trincomalee for treatment.
The ICRC said the group had been stranded at a makeshift hospital in Mullaitivu district for nearly a week.
It says that at least 16 patients were killed on Monday in shelling of a centre treating wounded civilians.
The shelling took place in the the town of Putumattalan, the ICRC said.
"We are shocked that patients are not afforded the protection they are entitled to," ICRC head Paul Castella said. He did not say who was behind the shelling.
For much of the last week there have been reports of civilians being killed as intense fighting continues between troops and Tamil Tiger rebels.
The Red Cross says the recent fighting has claimed hundreds of civilian lives and trapped tens of thousands of people.
1976: Liberation Tigers of Tamil Eelam form in the north-east
1987: India deploys peace-keepers to Tamil areas but they leave in 1990
1993: President Premadasa killed by Tiger bomb
2001: Attack on airport destroys half Sri Lankan Airlines fleet
2002: Government and rebels agree ceasefire
2005: Mahinda Rajapakse becomes president
2006: Heavy fighting resumes
2009: Army takes main rebel bases of Kilinochchi and Mullaitivu
On Monday, the military said 29 people died when a female Tamil Tiger rebel blew herself up in the north-east.
Independent journalists cannot travel to the war zone so information cannot be verified.
The government has meanwhile spoken out about its disputes with both the BBC and the UN.
The BBC World Service announced on Monday that it is to stop providing radio news to Sri Lanka's state broadcaster because of what it calls "deliberate interference".
Hudson Samarasinghe, chairman of the state-owned Sri Lanka Broadcasting Corporation (SLBC), told the Reuters news agency that he had received no formal notice of the suspension, which the BBC said would remain until its programmes were aired without interference.
Mr Samarasinghe said that SLBC had the right "to do as it wished" after paying for programming from outside sources.
"This is the voice of the nation," Mr Samarasinghe told Reuters. "I don't have the freedom to air the voice of (Tamil Tiger leader) Prabhakaran, who wants to divide the country."
The UN said on Tuesday that it was outraged by the "unnecessary" deaths of hundreds of people inside rebel territory and urged both sides to avoid fighting in civilian areas.
But Rajiva Wijesinhe, a secretary in the human rights ministry, said that the UN "risked confusing issues" relating to the government's conduct of the war by raising human rights issues which she said the government was already working to fix.
Sarasi Wijeratne, an ICRC spokeswoman in Colombo, said a ferry chartered by the ICRC had arrived from Jaffna on Tuesday morning to pick up the patients from the coastal village of Putumattalan. The vessel is now reported to be sailing towards Trincomalee.
"The sick and wounded are being put on the ferry," she told the BBC Sinhala service.
The suicide attack on Monday left 29 dead, the military says
She said both sides in the conflict had agreed to allow patients to be moved for treatment.
Earlier, Sri Lankan military spokesman Brig Udaya Nanayakkara said that civilians heading into government-controlled areas told soldiers that rebels had fired on a group of 1,000 people who were trying to flee the fighting.
"The civilians came to an army position carrying the 17 dead and 69 others who had gunshot injuries," Brig Nanayakkara said.
The government says thousands are trying to cross to safety each day and accuses the rebels of using civilians as human shields.
The pro-rebel TamilNet web site also says thousands are fleeing but that they are seeking shelter in Tiger-controlled areas because of army shellfire into the government-declared "safety zone".
It said at least 36 civilians were killed and 76 wounded because of military mortar and artillery fire.
The ICRC has expressed serious concern for more than 200,000 trapped civilians. The government says the number is about half that.
Both the UN and US condemned Monday's killings in the Vishwamadu area of Mullaitivu district.
About 50,000 soldiers are pressing the Tamil Tigers into an area of north-eastern jungle after taking the key areas of Kilinochchi, Elephant Pass and Mullaitivu.
The government has rejected international calls for a ceasefire, demanding the rebels lay down their arms.
The Tigers have said they will not do so until they have a "guarantee of living with freedom and dignity and sovereignty". The rebels started fighting in the 1970s for a separate state for Tamils.