Dead bodies, some covered with flies, littered the streets of N’Djamena, the capital of Chad, yesterday after a third day of clashes between government forces and Sudanese-backed rebels.

Aid workers reported thousands of civilians fled the city during a brief lull in exchanges of heavy gunfire and shelling.

Details were sketchy, but one witness told The Times a bridge over the Chari river into neighbouring Cameroon and the main road into the interior were choked with terrified residents trying to escape, many of whom had abandoned all their belongings and were on foot.

The medical aid charity Medecins sans Frontieres said in a statement that thousands of people had been wounded in the fighting. It began on Saturday after the rebels arrived in the capital after a lightning dash across the huge, land-locked central African country from their bases near the border with Sudan’s war-ravaged Darfur province.

Sudan again angrily denied that it was behind the attack, which has led to the postponement of a European Union peace keeping mission to protect refugees from Darfur now living in eastern Chad. The Arab-dominated government in Khartoum accuses Chadian President Idriss Deby of financial and military support of rebel groups, many of whom come from the same African tribe as Mr Deby and his closest allies, in Darfur.

The issue led to the severing of diplomatic ties in 2006 and has threatened to spark an all-out conflict between the two states. The Libyan leader Muammar Gaddafi has tried to keep the lid on the crisis, but several peace deals have unravelled before the ink was dry.

Yesterday, the rebels threatened a fresh offensive to overthrow the embattled president after apparently calling off a siege of his heavily fortified presidential compound in the west of the run down city. The president, French trained helicopter pilot, reportedly used helicopter gun ships to drive back the rebels, who have no reply to air power.

The Government said its forces had pushed the rebels to the outskirts of Ndjamena, but rebel leaders told news agencies in Chad they had made a tactical withdrawal, partly to allow civilians to leave.

One witness told The Times that several bodies, many wearing blood-stained battle fatigues, now covered the streets and government buildings, already shabby from years of neglect by one of the world’s most corrupt administrations, were pockmarked with bullet and shell holes.

A rebel spokesman, contacted by satellite telephone, told the French news agency Agence France Presse (AFP) the insurgency, the worst Mr Deby has faced since he took power in a 1990 coup, was far from over. Abderaman Koulamallah said: “We opted to leave the city but we certainly will go back on the offensive… we’re asking the civilian population to leave immediately because their safety cannot be assured.”

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