Chechen fighters were claiming to have killed "hundreds" of Russian soldiers in an attack on Gudermes, 20 miles east of Grozny, where they have surrounded the Russian command post and railway station.
The rebels launched their attack on Thursday morning, the day polling began in the republic, and Chechens arriving in Grozny from the area said fighting had continued yesterday.
The Russian news agency Interfax quoted a Russian security official as saying 22 soldiers had been killed and 41 injured in the fight for Gudermes. The agency said Russian soldiers evacuated from the town reported that 40 per cent of it had been destroyed.
Despite condemnation from critics who said elections would be a farce as long as the war continued, Moscow arranged for a vote to choose a new Chechen leader at the same time as a nationwide parliamentary poll. Voting has been spread over four days to allow for any disruption due to the precarious security position.
President Boris Yeltsin's chief of staff, Sergei Filatov, told Itar-Tass that Doku Zavgayev, Russia's preferred candidate, had won 85 to 90 per cent of the vote. Official turnout figures were put at 50 to 70 per cent, although journalists saw few signs of people voting.
Mr Yeltsin's special envoy in Chechnya, Oleg Lobov, cast his vote in Grozny's fortified airport along with Mr Zavgayev.He said the turnout was near 70 per cent, citing migrant builders working to restore ruined Grozny and Russian soldiers among the voters. The vote, he said, was a "remarkable event".
The Russians feared some sort of terrorist attack in Grozny by separatist fighters loyal to General Dzhokhar Dudayev, who still claims to be the legitimately elected president of an independent Chechnya.
However, Grozny was quiet. Soldiers tightened their control of the city, blocking off main streets from traffic and allowing only local drivers in and out.
Instead it was in Gudermes that the chief of Chechen forces, Aslan Makhadov, chose to launch a carefully planned military operation that he said was aimed at preventing elections from taking place. He said on Saturday that his forces were in complete control of the town.
The Chechen action has shown how little of the territory the Russian forces control a year after invading the region and laying waste to its capital. The rebels control a swath of territory south of Grozny and still command strong loyalty among the population in the villages. Peace talks apparently have broken down irretrievably since a bomb blast in the autumn put Russia's top general in a coma.
Yesterday's voting in Grozny was ramshackle, with no registration lists and no control over multiple voting. One man voted for himself, his wife and his daughter, who he said was ill. However, he had no documents to prove he had any family.