Fierce fighting rocked the Yarmuk refugee camp in southern Damascus on Tuesday as rebels fought to drive out a pro-regime Palestinian militia, the Syrian Observatory for Human Rights said.

The renewed clashes came two days after warplanes bombed the camp for the first time since the start of Syria's more than 21-month conflict, killing eight civilians, said the Britain-based Observatory.

The raid came hours after the rebel Free Syrian Army made significant advances in Yarmuk, a stronghold of militant groups closely allied with the regime of Syrian President Bashar al-Assad.

On Tuesday, explosions were heard inside the camp amid fierce clashes involving rebel battalions including Palestinian fighters, said the Observatory.

"There are definitely Palestinians fighting with the rebels. For the past three days we have seen the bodies of Palestinian fighters killed in battle with the opposition in Damascus province," Observatory director Rami Abdel Rahman said.

Meanwhile, residents were fleeing the camp for the second day in a row, the Observatory said. It noted that other southern districts also came under shelling overnight, leaving residents with few options nearby.

Clashes also broke out between rebels and the army in the town of Beit Saham southeast of Damascus alongside the Damascus airport road, while some people were injured in mortar fire in the nearby town of Jaramana.

Overnight, regime forces also carried out operations in the northeast outskirts of the capital, shelling Harasta, Irbin and Zamalka, the Observatory said, also reporting bombardments on the southwest embattled town of Daraya.

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