Thousands of regional militiamen allied to Somalia's weak government poured into a key central town on Monday, preparing to attack advancing Islamist fighters and further raising fears of all-out war.
As many as 3,000 heavily armed gunmen loyal to authorities in the semi-autonomous enclave of Puntland, who have vowed to resist the powerful Islamist movement, moved into the town of Galkayo, witnesses said.
Residents of Galkayo said the fighters were backed by Ethiopian soldiers but Puntland authorities denied this and maintained their deployment was defensive after the Islamists seized a nearby trading post on Sunday.
Still, the build-up, coming after the government's rejection of a new peace
initiative, stoked concern for a war that could spread through the Horn of Africa, drawing in Ethiopia and its arch-foe Eritrea.
And, militia commanders affiliated with ex-Mogadishu warlord Abdi Awale Qeybdiid said they would drive the Islamists from their newly won prize of Bandiradley, about 70 kilometres (44 miles) south-west of Galkayo.
"We are preparing to wage an attack on the terrorists around Bandiradley to retake the town and this will happen soon," commander Saidi Dhegoweyne told AFP by phone from Galkayo, about 700 kilometres north of Mogadishu.
Residents said they saw between 1,000 and 3,000 Puntland soldiers, some on machine-gun mounted pick-ups, along with six vehicles of uniformed Ethiopian troops, roll through the town in the direction of Bandiradley.
"I saw Puntland militiamen accompanied by Ethiopian soldiers entering the town," said businessman Abdulkadir Ali Koshin. "I can't tell the exact number, but I saw six armoured vehicles and uniformed (Ethiopian) soldiers on board.
"They were headed to the frontline," he told AFP.
At least 13 people were killed on Sunday when the Islamists captured Bandiradley from Qeybdiid's men, moving to their most northerly point since seizing Mogadishu and most of southern and central Somalia beginning in June.
The seizure brings them the closest they have come to Galkayo, which marks the border with Puntland, which has been relatively calm and free of the violence that has wracked the south and center for the past five months.
Ali Abdi Warre, a security official in Mudug region, which includes both Galkayo and Bandiradley, said as many as 10,000 Puntland troops would be marshalled to defend the enclave but denied any Ethiopian presence.
"We are only preparing to defend Puntland if the Islamists attempt to attack us," Warre told AFP from Galkayo, saying of the Ethiopians: "I can assure you there are none here."
The Islamists deny they want to seize Galkayo, a hotbed of support for Somalia's Ethiopian-backed President Abdullahi Yusuf Ahmed, but say they will defend themselves and pursue their attackers wherever they go.
"We have not any intention to attack Galkayo, but if they attack us, we will follow them until we track them down," said Mohamed Jumale, an Islamist spokesman in central Somalia.
"We will not spare any town at that time and we will ensure all towns in the region under our control, even Galkayo," he told AFP.
A move on Galkayo would be a major escalation in the deteriorating situation in Somalia that diplomats and analysts fear could erupt into full-scale war and engulf the Horn of Africa region in bloody conflict.
It would also open a second front for the two sides whose forces are girding for battle around the government's seat of Baidoa, about 250 kilometres north-west of Mogadishu, where Ethiopian troops are also reported.
Mainly Christian Ethiopia has vowed to defend itself and the transitional administration from attacks by the Islamists.
But Addis Ababa denies the presence of combat troops in the lawless nation, saying it has only deployed military advisers and trainers.