The clashes have killed 10 people and wounded 125, including two soldiers, the government said. The troops used tear gas, rubber bullets and live rounds on demonstrators, who set fire to tires and a police bus.
Explosions echoed through streets emptied of shoppers and tourists, plumes of black smoke rose amid skyscrapers and hotels, and the deteriorating security raised concerns that Thailand - a key U.S. ally with Southeast Asia's second-largest economy - was teetering toward instability because of the two-month political crisis.
The Red Shirt protesters began their campaign to oust the government in March, saying it came to power illegitimately and is indifferent to the poor. In several rounds of violence since then, 3 people have been killed and more than 1,400 wounded.
Protesters have urged 82-year-old King Bhumibol Adulyadej to end his long silence and intervene, but there was no word from the widely revered ailing monarch.
The latest violence erupted Thursday after the Red Shirts' military strategist - a former Thai general - was shot and seriously injured, apparently by a sharpshooter, as he spoke to foreign journalists. One protester was fatally shot later Thursday and four were killed Friday, the army said. Among the wounded were two Thai journalists and a Canadian reporter - all from gunfire.
Witnesses saw several groups of a dozen or more people detained at the scene of several clashes. No figures were released on how many were detained.
As night fell, defiant Red Shirt leaders led followers in Buddhist prayers and called on volunteers to bring more tires for their barricades.
"Death cannot stop us civilians from continuing our fight," said Jatuporn Prompan, a protest leader.
The Red Shirts, mostly rural poor, began camping in the capital March 12 to try to force out Prime Minister Abhisit Vejjajiva. They claim his coalition government came to power illegitimately through manipulation of the courts and the backing of the powerful military.
The military had forced Thaksin Shinawatra, the populist premier favored by the Red Shirts, from office in a 2006 coup. Two subsequent pro-Thaksin governments were disbanded by court rulings before Abhisit became prime minister.
In a Twitter message from exile, Thaksin said the "very cruel and unusual government" will "end up as war criminals" in the International Court of Justice.
About 10,000 Red Shirts have barricaded themselves in a 1-square-mile (3-square-kilometer) protest zone in Rajprasong, Bangkok's premier shopping and diplomatic enclave. They have set up a perimeter of tires and bamboo stakes, refusing to leave until Abhisit dissolves Parliament and calls new elections.
The occupation has forced luxury hotels and high-end shops to close for weeks. Major roads around the protest site were blocked to traffic Friday, and the city's subway and elevated train shut down early. The embassies of the United States, Britain and other countries were also closed.
The political uncertainty has spooked foreign investors and damaged the vital tourism industry, which accounts for 6 percent of the economy.
"Abhisit must dissolve Parliament and return power to the people immediately, and not serve as caretaker prime minister," Jatuporn said from a stage in the protest zone, which is now encircled by the army in a wider perimeter.
As Jatuporn spoke, a series of gunshots rang out close by, panicking the crowd of listeners who shrieked in fear and ducked for cover.
"We are being surrounded. We are being crushed. The soldiers are closing in on us. This is not a civil war yet, but it's very, very cruel," Weng Tojirakarn, another protest leader, told The Associated Press.
The crisis appeared to be reaching a resolution last week when Abhisit offered to hold elections in November, a year early. But the hopes were dashed after Red Shirt leaders made more demands.
Jatuporn said only the king "can stop the killings of civilians by Abhisit."
The beloved monarch has in the past mediated political crises, but he has stayed away from commenting on this one. Observers say he may be reluctant to get involved in a conflict that he may not be able to solve. Another problem is his failing health - he has been hospitalized since September and the palace has given no updates after initially describing his ailment as a lung infection.
The Red Shirts have kept soldiers at bay by firing guns and homemade rockets, hurling rocks and commandeering government vehicles. Some bolder protesters came close to the soldiers on motorcycles, shouted obscenities and sped away.
Army spokesman Col. Sansern Kaewkamnerd said some protesters also used grenades and other weapons, and have an estimated 500 armed fighters.
The troops have kept their distance and made little progress toward their goal of clearing the streets.
Soldiers addressed the protesters with a loudspeaker, saying: "We are the people's army. We are just doing our duty for the nation. Brothers and sisters, let's talk together."
Sansern said soldiers will tighten the perimeter around the protest site in the next few days and will conduct operations without advance warning.
"The measures we will apply will definitely be more intense than what has been done so far," he told reporters.
The government said authorities are not trying to disperse the protesters forcibly but only pressure them so that they leave voluntarily.
"Security forces have refrained from entering the rally area and the (violence) occurred because the protesters attacked them," he said, adding that authorities "needed to defend themselves."
Among the injured was Canadian freelance journalist Nelson Rand, who works for France 24 news channel. He was hit by three bullets and was recovering after surgery.
Bangkok residents found it hard to come to terms with the violence in their city, which prides itself as an exotic and welcoming gateway to the Land of Smiles, as Thailand is fondly known.
"I've never seen anything like this. I heard gunshots and explosions all day," said Kornvika Klinpraneat, a 7-11 employee. "This is like a civil war. The battle is being fought in the middle of the city."
The two-day clashes marked the worst violence since April 10, when 25 people were killed and more than 800 injured. Four others were killed in subsequent clashes.
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