Moscow's generals were preparing for a "large-scale" military operation against the guerrillas, who surrounded villages in Dagestan - a republic in the Russian Federation. About 1,000 Dagestani police reportedly were gathering in the north Caucasus republic alongside Russian troops. Several thousand refugees were said to be pouring out of the mountainous conflict zone, which came under missile fire from Russian helicopters on Saturday amid some of the worst fighting since the end of the Chechen war in 1996.
Witnesses told Interfax news agency that the gunmen were Wahhabi militants seeking to establish an independent Islamic republic in union with Chechnya. The paramilitaries - who took local men hostages - were mostly Chechens, led by Shamil Basayev, they said.
Mr Basayev, a feted Chechen commander, is regarded by Moscow as a terrorist. After a four-hour visit to Dagestan, thePrime Minister, Sergei Stepashin, said he was "not afraid" of taking on the guerrillas but ruled out a new war.
The number of Islamic fighters surrounding the villages - Ansalta, Echeda, Miarso and Rokhota - was unclear. Initial estimates put them at 200 although the Russians talked of as many as 2,000. News that their leader is believed to be Mr Basayev horrified Russians. He led a raid into Russia in 1995, taking 1,000 hostages and then, to Russian disgust, negotiated free passage home.
He leads an organisation called the Congress of the Nations of Ichkeria (Chechnya) and Dagestan. Sources within the congress told Interfax that the Islamic fighters in Dagestan were setting up a local government and Sharia courts in the seized areas.
The possibility of a new war is a nightmare for Moscow. Defeat in the 21-month Chechen war taught it the impossibility of controlling a mountainous Muslim region that has never accepted rule by Orthodox Russia.
Yet the latest events place Moscow in a quandary. Dagestan provides access to the Caspian Sea, and is a trans-shipment route for oil. Its loss would be seen in Moscow as evidence that Islam is making dangerous incursions. At present, secession looks improbable. Dagestan, with some 30, often divided, nationalities, is riddled with clan conflict and organised crime. Much more likely is a slide into local civil strife, which Moscow will - with difficulty - try to control.Reuse content