The fighting, the worst in the region since the beginning of this year, showed Boris Yeltsin was back at square one with the Chechen separatists, neither able to make peace with them, as he promised to do before the presidential elections, nor capable of crushing them.
Throughout the day, Russian helicopter gun ships fired rockets against rebel positions in various parts of the city because federal forces had more or less lost control of the situation on the ground. Interfax news agency said the guerrillas were blocking Russian troops at their own checkpoints. "Our correspondent reports that the city is effectively controlled by the rebels," it said.
In the afternoon, the rebels seized the telephone exchange and launched an attack on the government compound, forcing officials to scurry down to the basement. The most senior officials of the puppet government, led by Doku Zavgayev, had already retreated to the Russian military base at Khankala, on the edge of the city. Even there they were not safe, as Interfax reported that a sniper had picked off and killed the commander.
In the absence of television pictures, the news agency journalists became stars. Sergei Trofimov of Tass filed from the besieged compound: "The journalists are going down into the basement of the building which is under fire from grenade launchers." He added: "They will try to report information for as long as possible."
Interior ministry troops and Chechen police defended the compound against the rebels, whose attacks eased in the evening. A spokesman said the separatists offered to open up a corridor to let out journalists and civilians. A column of Russian armour with regular troops set off from Khankala to reinforce units in the city but was unable to reach them immediately as the rebels had mined the road into town.
The army seemed reluctant to help the lightly armed interior ministry troops, perhaps remembering the disastrous days of early 1995, after Moscow first intervened in Chechnya, when soldiers intanks proved to be easy targets for fast-moving guerrillas, until Kremlin forces finally took the Chechen capital. The rebels retreated to the southern mountains but made a raid on Grozny this March, before the present assault.
The Deputy Interior Minister, Pavel Golubets, said 29 Russian soldiers had been killed and a hundred injured in this week's battles. Interfax cited a military source who put the death toll among federal troops at 50 and said 200 had been wounded. There were no casualty figures for the rebels or civilians caught up in the fighting.
Many civilians were reported to have left Grozny before the rebels infiltrated the city on Tuesday, raising speculation that the separatists had warned sympathisers about the attack.
But Moscow should have read the signs. For days before their offensive, the rebels had been making no secret of their anger about Russian air raids on Chechen villages, which broke the peace deal Mr Yeltsin made to woo voters last month.
Moderate Chechen leaderssay the latest assault is designed to force Moscow back to the negotiating table. But Russian officials now rule out talks. Fundamentalist Chechens, such as Salman Raduyev, who was believed dead but recently resurfaced after plastic surgery, will settle for nothing less than forcing Russia out of Ichkeria, as the separatists call Chechnya.
The eruption of Russia's "internal Afghanistan" has left Moscow floundering. Yesterday President Yeltsin seemed interested only in the preparations for his inauguration on Friday.
Ordinary Russians do not, perhaps, expect anything more inspiring from their ageing leader, who is said to have been exhausted by the election campaign. But they are puzzled by the lack of initiatives from Mr Yeltsin's new national security adviser, Alexander Lebed, co-opted onto the Kremlin team after doing well in the first round of the presidential election and widely expected to come up with a fresh approach to Chechnya.
Yesterday the retired general said only that the Chechen problem could not be solved "exclusively by coercive methods" and talked of "organising a congress of representatives of the Chechen people".