NAHR EL-BARED, Lebanon (AFP) -- Fighting resumed between Lebanese troops and Islamists holed up in a northern refugee camp on Saturday, a day after the most intense exchanges of the two-week-old siege.

Soldiers were heavily pounding the Nahr al-Bared Palestinian refugee camp, where the army is besieging fringe militant group Fatah al-Islam, while machineguns fire was heard from inside, an AFP correspondent said.

Smoke was seen billowing from above the centre and north of the camp.

Three soldiers were killed in the intense exchanges on Friday, in which the army said there were also "many casualties" among the Islamist fighters inside the camp, where the situation of trapped civilians was said to be desperate.

But the clashes died down during the night and there was only sporadic fire, military sources said.

The army's latest losses took to 83 the death toll since the fighting erupted on May 20, 38 of them soldiers, in what is by far Lebanon's deadliest internal fighting since the 1975-1990 civil war.

The Beirut government has said it would prefer a peaceful end to the siege but has also insisted that Fatah al-Islam hand over its fighters to stand trial for the deadly assaults on government troops, something it has consistently refused to do.

The army on Friday again charged that the militants were using the 5,000 or so civilians still believed to be trapped in the camp as human shields.

The United States voiced its strong backing for the army operation while expressing concern for the plight of the civilians inside the camp.

"The Lebanese government is doing what it needs to be able to fight against a very dangerous terrorist group, and to bring law and order throughout the country," State Department spokesman Tom Casey said. "They've assured us that they are going to do everything they can in conducting these operations to minimize its impact on the civilian population in the camps."