Police fired on pro-democracy protesters Tuesday in Nepal's capital, leaving at least 12 people injured, a human rights activist said. It was not clear if the police fired rubber bullets or live ammunition.

The clash came amid days of increasingly violent confrontations between security forces and protesters demanding that Nepal's king give up absolute power, and just hours after police fired on stone-throwing protesters in the resort town of Pokhara, wounding two people, an official said.

The royal government, meanwhile, has responded to the continuing protests by imposing a daytime curfew in Katmandu and two other towns at the center of the rallies.

Details were scarce on Tuesday's Katmandu clash, but it came in a neighborhood on the city's edge, when protesters marched toward a line of police from an area not covered by the strict curfew rules.

When the protesters didn't retreat, the police first beat them and then opened fire on them, said Poshraj Adhikari, of the rights group INSEC-Nepal.

Jagat Basnet, a local resident, said by telephone that police had fired several times at the protesters. "I saw one running man get hit and collapse," Basnet said.

Adhikari, the human rights activist, said the army was beginning to move into the neighborhood to take control of the situation.

The government also announced it would launch a search of houses across Katmandu in search of terrorists who they say have infiltrated the pro-democracy protests.

"The security forces are searching for these terrorist for which there will be a massive search of private homes," a Home Ministry statement said, urging residents to cooperate.

The U.S. State Department, meanwhile, called on King Gyanendra to restore democracy, declaring that 15 months of direct palace rule "has failed in every regard."

"The demonstrations, death, arrests and Maoist attacks in the past few days have shown there is more insecurity, not less," State Department spokesman Sean McCormack said in Washington on Monday.

Some 10,000 people marched Tuesday through the center of Pokhara, about 125 miles west of Katmandu, when some began throwing stones at police, who responded first with tear gas and rubber bullets and then with live gunfire when the protesters refused to disperse, according to a town official who spoke on condition of anonymity because he was not authorized to speak to the press.

The king has been vacationing in Pokhara, a resort town popular with foreign tourists, for the past few weeks, even as the protests have spread from Nepal's major cities to its far-flung towns.

There have been daily protests and clashes with security forces throughout the country since Thursday, when the country's seven major opposition parties called a strike. Security forces have killed three protesters and put more than 1,000 in jail.

The parties are demanding the king relinquish the power he seized last year, when he said he needed to crush the Maoist insurgency and enable the country to hold elections that had been delayed due to the violence.

The strike has continued into this week, shutting down roads, schools, and stores in most parts of the country.

On Tuesday morning, many of Katmandu's 1.5 million people scrambled during a short window in the curfew to get food and other supplies. The current curfew ordered everyone off the streets from noon to 5 p.m., and again from 10 p.m. to 4 a.m.

"My son and daughter and their children, we are all stuck in our house," said Priya Ranjit, a 58-year-old woman buying rice and other food in Katmandu. "This can't go on, we need to go to work for our money."

Up the road, a few hundred protesters had gathered, chanting "Democracy! Democracy! Down with autocracy!" Behind them, a small pile of tires burned, sending a plume of black smoke into the air.

Dozens of riot police armed with batons and shields watched until the protesters stopped a motorcycle, pulled off the driver off and tried to burn the bike. The officers then charged in, swinging their batons and sending the protesters scrambling to the safety of side streets.

The crisis has shown no sign of abating, with police firing rubber bullets and tear gas at stone-throwing protesters who have defied curfews and taken to the streets for five straight days.

While Nepal has been shaken by protests repeatedly since the king took power, this has been the first time that thousands of workers, professionals and business people have marched alongside students and political activists.

Despite the violent crackdown, Nepal's seven-party opposition alliance has vowed to press on indefinitely with the strike and its protests against the king.