Blind Chinese activist Chen Guangcheng is under U.S. protection in Beijing after an audacious escape from 19 months under house arrest, a U.S.-based group said on Saturday, in a drama that threatens to ignite new tensions between the two governments.

The United States has not given any public confirmation of reports that Chen, who slipped away from under the noses of guards and bristling surveillance equipment around his village home in Shandong province, fled into the U.S. embassy.

China has also declined direct public comment on Chen's reported escape, which threatens to overshadow a two-day meeting with top Obama administration officials, including Secretary of State Hillary Clinton, in Beijing from Thursday.

But Texas-based ChinaAid said it "learned from a source close to the Chen Guangcheng situation that Chen is under U.S. protection and high level talks are currently under way between U.S. and Chinese officials regarding Chen's status".

"Because of Chen's wide popularity, the Obama Administration must stand firmly with him or risk losing credibility as a defender of freedom and the rule of law," Bob Fu, president of the religious and political rights advocacy group that has long campaigned for Chen's freedom, said in an email.

The reports of Chen's escape come nearly three months after a Chinese official Wang Lijun fled into a U.S. consulate for over 24 hours on Feb. 6, unleashing a scandal that has rattled the ruling Communist Party months before a once-in-a-decade leadership handover.

Wang's brief flight to the U.S. consulate led to the downfall of top official Bo Xilai who had been openly campaigning for a place in the inner circle of power in Beijing.

Pu Zhiqiang, a Beijing lawyer and rights advocate, said reliable contacts also told him Chen took refuge in U.S. embassy grounds. The incident will be another damaging blot on China's security services, following Wang's flight, said Pu.

"Everyone knew about the suffering of Chen Guangcheng and his family but nobody dared raised his head over this and ignored it," he told Reuters, referring to Chinese officials.

"Chen Guangcheng has been the most typical victim of this lawless, boundless exercise of power," said Pu. "But the day has finally come when he has escaped from it."

Chen, a self-schooled legal advocate who campaigned against forced abortions, had been held under extra-legal confinement in his village home in Linyi in eastern Shandong province since September 2010 when he was released from jail.

His confinement under relentless surveillance with his family fanned protests by Chinese sympathisers and criticism from foreign governments and groups.

Chen's escape and the furor it has unleashed could add to the headaches of China's ruling Communist Party, which is striving to ensure stability and authority before a leadership transition later this year.

It also threatens to overshadow a visit by Clinton and Treasury Secretary Timothy Geithner, who are due in Beijing next week for the annual "strategic and economic dialogue" between the two countries.

Asked whether any issue could force the meeting to be canceled or postponed, Chinese Vice Foreign Minister Cui Tiankai said, "I don't know why you'd ask the question."

"Our holding this briefing today shows that the Strategic Economic Dialogue will take place as scheduled," Cui told a news conference about the China-U.S. dialogue. He said he had "no information" on Chen.

Hu Jia, a Beijing dissident who met Chen several days ago in Beijing, recounted that Chen said he would not seek asylum from within the U.S. embassy.

"If they catch him, there will be unprecedented retaliation against him. So in the end we decided there was only one place that could guarantee his safety," Hu said, referring to the embassy.

"Before making a decision to go there, he said he wanted to stay and fight, and not request asylum," added Hu.

Later Saturday, Hu was escorted away by a group of police, according to his wife Zeng Jinyan. More police were likely to come to take her away as well, she said.

"The situation is very complicated. The police are outside right now," Zeng said in a strained voice before ending the conversation.

Washington and other Western governments have criticised Beijing's jailing and confinement of dissidents, protesters and other citizens who challenge Communist Party power. China says such criticism is unwelcome meddling in domestic affairs.

Sensitive Moment

Two prominent Chen supporters, friend He Peirong and Beijing researcher Guo Yushan, were out of contact on Saturday, suggesting they might have been detained over the incident.

There was no sign of any greater than normal security around the U.S. embassy, a fort-like compound of concrete and steel in northeast Beijing.

If he is sheltering inside, that could thrust Washington back in the midst of a volatile political moment for China, recalling the case of dissident astrophysicist Fang Lizhi. He hid inside the U.S. ambassador's resident with his wife after the 1989 Tiananmen crackdown, to Beijing's outrage.

Fang settled in the United States and died recently.

Officials in Shandong said on Saturday they had no comment on Chen's escape. State media has made no mention of the saga.

"It is the Shandong government that has bungled this by turning a small matter into an international affair," said Li Datong, a former editor at the China Youth Daily, a party paper, who was pushed aside for denouncing censorship. "It is certainly a loss of face for the central government."

"It is especially a loss of face if a regular Chinese citizen has gone to another government to seek protection."