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Tamil Tiger rebels attacked five army camps in Sri Lanka's east and tried to infiltrate government lines in the north, sparking fierce clashes that killed at least 17 people, the military said.
Dozens were wounded in the pre-dawn rebel assault in eastern Batticaloa district where an estimated 155,000 war refugees are staying in rudimentary camps, as the military seeks to drive the rebels from territory they control.
The army returned fire and Air Force jets bombed rebel-held jungle terrain.
"They have come and attacked five camps, firing mortars and artillery. We have retaliated and found eight bodies of dead cadres as well as munitions," said military spokesman Brigadier Prasad Samarasinghe.
"There are four army dead, as well as three seriously injured from mortars," he added, saying 14 troops and 11 civilians had suffered minor shrapnel injuries and that troops had in turn captured a major Tiger camp.
The army estimates around 30 Tigers were badly wounded, but there was no independent confirmation.
Samarasinghe said five Tigers were killed in a separate incident in the northern army-held Jaffna peninsula when they tried to cross a defence line that separates government and rebel-controlled territory.
Samarasinghe said he believed the Tigers launched the attack to deflect pressure from a swathe of jungle called Toppigala, southwest of Batticaloa town, where the rebels retreated after the fall of a key eastern stronghold in January and are now surrounded.
The Liberation Tigers of Tamil Eelam (LTTE) were not immediately available for comment.
Wednesday's clashes come days after the military said air force jets bombed a north-eastern Tamil Tiger naval base and after the navy sank two large ships it said were transporting arms for the Tigers, as well as four smaller rebel vessels.
The military has captured about 600 square kilometres of territory from the Tigers in recent months, but analysts say while the rebels have faced setbacks, there is no clear winner on the horizon.
The government has vowed to wipe out the Tigers militarily, the rebels have warned of a bloodbath and foes have repeatedly ignored calls from the international community to halt a conflict that has killed around 68,000 people since 1983 - including about 4,000 in the past 15 months.
