Nepalese government forces killed as many as 500 rebels, and at least 18 police and soldiers died in some of the fiercest fighting since a cease-fire collapsed last year, officials reported on Sunday.

Hundreds of rebels swarmed into Beni (search), a mountain town 175 miles west of Katmandu (search), the capital, and battled security forces for nearly 12 hours before being chased away by reinforcements, according to Army Spokesman Col. Deepak Gurung (search).

Rebels attacked the town's jail, bombed the district administration office and set fire to the police station. They also attacked an army camp using automatic rifles and mortars, Gurung said.

Eleven soldiers and seven policemen were killed in the fighting, and two soldiers and 16 policemen were injured, Gurung said.

"We believe at least 500 rebels could have died in the encounter," Gurung said. It was impossible to independently confirm the army's claim because the area was sealed by the military.

The guerrillas also bombed a bridge on the road leading to the town and knocked down the telecommunications tower.

Fighting between the rebels and government soldiers has escalated since the insurgents withdrew from a seven-month cease-fire in August after three rounds of peace talks. The two sides failed to break an impasse over the rebels' demands for a special elected assembly to draft a new constitution, and to decide if Nepal's king should continue as a constitutional monarch.

The rebels have been fighting since February 1996 to replace Nepal's monarchy with a communist state. The insurgency has claimed more than 9,000 lives.