COLOMBO, Sri Lanka - Fighting between Sri Lankan government forces and Tamil rebels retreating to a small patch of jungle has trapped thousands of innocent people and killed "many" civilians, a senior United Nations official said Monday.

The military captured the rebels' final stronghold of Mullaittivu on Sunday and fought heavy battles with the separatists in a rapidly shrinking, densely populated war zone Monday, the military said.

With a huge civilian population in the confined area, the situation has grown desperate in recent days, UN resident co-ordinator Neil Buhne told The Associated Press.

"There have been many civilians killed over the last two days," he said. "It's really a crisis now."

Buhne said that until recently both sides in the fighting worked hard to avoid civilian casualties.

"But in the current phase, with such a level of fighting and with so many people around, unless there is very, very close attention to it, it's almost inevitable," he said.

Human rights groups and diplomats have expressed growing concerns about the safety of the civilians in the north in recent days.

The government unilaterally declared a "safe zone" in a small section of rebel-held territory last week and called on all the civilians to move into that area, where they would be protected.

But there have been several reports of artillery fire in that region and Buhne said there was regular fighting in the "safe zone" in recent days.

"It's hard for us to assign responsibility, but there's definitely been fighting," he said.

The military has repeatedly denied fighting in that area.