Khartoum: Sudanese troops and rebels engaged in heavy fighting on Saturday near the South Kordofan state capital Kadugli, both sides said, with rebel shells landing inside the town.
A resident of Kadugli said rounds had passed over his house.
"Two rockets or mortars from SPLM-North," landed in the town, the resident told AFP, asking for anonymity.
Reports of casualties could not be immediately confirmed.
A statement from the Sudan People`s Liberation Movement-North said "our artillery unit shelled military positions inside Kadugli city" as well as in the Daldako and Al-Hamra areas outside it.
The strike on Kadugli occurred as rebels launched a "heavy counterattack offensive" against government forces in the Al-Atmur area, 45 kilometres (30 miles) from the capital.
They said they killed 15 government troops and destroyed a tank during the fight for the area which the Sudanese Armed Forces (SAF) said on June 6 they had "liberated". SAF described the area as a rebel base.
"There was a great battle there," on Saturday, SAF spokesman Sawarmi Khaled Saad told AFP.
"Yes, they tried to attack Al-Atmur area but we defeated them," he said.
Government forces still hold the region after about 50 rebels were killed, Saad added.
Analysts say casualty figures from either side in the war should be treated with caution.
Fighting in South Kordofan has intensified over the past couple of months.
The Kadugli resident said he could hear the battle which began about 6:00 am (0300 GMT) and continued for around four hours.
"There was mutual heavy artillery from the two parties," he said.
SPLM-N has periodically shelled Kadugli since late 2012 in attacks the government says have killed civilians.
On Wednesday, rights group Amnesty International said the government`s intensified aerial bombing of South Kordofan in recent weeks may be part of an attempt to starve the population.
A senior ruling party official, Rabbie Abdelatti Ebaid, countered that it is the government`s responsibility to protect civilians, while aiming to establish peace and security in the area.
Like the 11-year conflict in Sudan`s Darfur, the three-year-old South Kordofan war has been fuelled by complaints among non-Arab groups of neglect and discrimination by the Arab-dominated regime in Khartoum.