Government forces and rebels clashed for a third day in Chad's capital Monday with gunfire and shelling heard throughout the city, a U.N. official said.

Thousands of people were fleeing the fighting in N'Djamena and casualties were believed to be high. The violence is threatening peacekeeping and aid operations intended to stabilize a wide swath of Africa that borders the war-ravaged Darfur region of Sudan.

Earlier, officials said the rebels had withdrawn from the capital of the oil-rich country overnight after encountering fierce resistance from government forces backed by helicopter gunships and tanks.

U.N. Secretary-General Ban Ki-Moon said he was "profoundly alarmed" by the fighting. The U.N. Security Council, which held an emergency meeting Sunday, was to meet again Monday.