Thai and Cambodian soldiers exchanged rockets and gunfire across their shared border yesterday in a deadly battle over a trifling cause: a small and remote plot of jungle adjoining an ancient Hindu temple.

At least two Cambodian soldiers were reported to have been killed and five Thais and two Cambodians were injured in the afternoon battle at the mountain-top Preah Vihear temple, a tourist attraction and World Heritage Site, which is 1,100 years old.

The Thai Foreign Minister urged his countrymen to flee Cambodia for fear of reprisals after an incident that will enrage nationalists further in both countries and make a diplomatic solution to the decades-old border dispute more difficult than ever.

Each side accused the other of opening fire first and gave a different account of the duration of the battle. Journalists on the Cambodian side of the border reported seeing rocket-propelled grenades fired by the Thais. At least ten Thai soldiers who were stationed in a pagoda surrendered to the Cambodians.

“We are not the ones who ignited the violence,” Somchai Wongsawat, the Thai Prime Minister, said in the capital Bangkok. “The situation has returned to normal now. It is not serious and I am convinced there will be resolution.”

After the outbreak of fighting military talks were announced, which are scheduled to be held today.

Hun Sen, the Cambodian Prime Minister, held an emergency meeting with ministers and generals in Phnom Penh the day after threatening a “life-and-death battle” if Thailand did not pull its forces back.

Earlier in the day Thailand had put jet fighters on alert and prepared for a potential evacuation of civilians from border areas by placing Hercules transporter aircraft on standby at an air force base in Bangkok.

Sompong Amornvivat, the Foreign Minister, urged Thais in Cambodia to return home immediately. “Thai businessmen who have no need to be in Cambodia now, please rush back to Thailand,” he said. “We have our evacuation plan ready.”

The territorial dispute, which led to the battle, dates back 50 years but it developed into a political and military crisis only this summer.

Perched on the top of a 1,600ft (490m) cliff, Preah Vihear can be reached far more easily from Thailand than from Cambodia. The territory was awarded to Cambodia in 1962 by the International Court of Justice after lengthy legal arguments, which involved maps produced during Cambodia’s French colonial period.

However, one plot of jungle, which measures 1.8 square miles, was never allocated clearly, and it is over this land that the two countries fought.

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