Cracks of gunfire and explosions echoed inside the capital for a third day, including a firefight near the country's parliament, in an unprecedented challenge to government rule in President Bashar Assad's seat of power.

Neighboring Iraq called on its citizens living in Syria to return home, as the fighting overshadowed another round of diplomatic maneuvering to end the civil war, with special envoy Kofi Annan in Moscow in an attempt to rescue his faltering peace plan.

Plumes of gray smoke billowed over the Damascus skyline and helicopter gunships strafed the area, activists said — a sign the regime is growing desperate to push the rebels away from the heavily-guarded capital.

Terrified families fled the city or said they were prepared to leave at a moment's notice. Residents said they were packing "getaway bags" in case they had to run for their lives.

"My bag has my family's passports, our university degrees, some cash and medicine," a 57-year-old father of two told The Associated Press, asking that his name not be used for fear of reprisals. "It is very hard to imagine leaving your home and everything you worked to get, but it's a matter of life and death."

Clashes were concentrated in the neighborhoods of Kfar Souseh, Nahr Aisha, Midan and Qadam — a mixture of lower- and middle-to-upper-class districts in the city's southwest where street battles first erupted Sunday. Heavy clashes were also reported in Qaboun, a neighborhood in northeast Damascus.

"The streets are completely empty, the shops are closed. People are terrified of what's next," said Omar Qabouni, an activist in Qaboun. He said eight people were killed Tuesday in mortar and tank shelling by government forces. He estimated that about 300 rebels were taking part in the fighting.

Activists and residents said the fighting also reached new areas Tuesday, with brief firefights erupting in Sabeh Bahrat Square, Baghdad Street and Sahet Arnous in downtown Damascus, about 400 yards (meters) from the Syrian parliament.

The clashes broke up quickly as the rebels fled, but were a significant indicator of the rapidly spreading violence and the deep reach of the rebels as they become more confident and better armed.

The Damascus clashes were a sign the civil war was likely to worsen as the Syrian regime struggles to halt the opposition's growing momentum.

"The Syrian army's increasing deployment of artillery and helicopter gunships underscores that the regime is prepared to escalate its use of force concurrently with the armed opposition's improving capabilities," wrote Torbjorn Soltvedt, senior analyst at Maplecroft, a British-based risk analysis company in a report released Tuesday.

Syria's state-run news agency said troops were still chasing "terrorist elements" who had fled from Nahr Aisha to Midan. The Syrian regime refers to armed rebels as terrorists.

Troops also threw up multiple checkpoints and were searching cars in an effort to seal the capital off from rebellious areas in the suburbs.

"I can hear cracks of gunfire and some explosions from the direction of Midan," Damascus-based activist Maath al-Shami said via Skype. "Black smoke is billowing from the area."

An amateur video showed two armored personnel carriers mounted with heavy machine guns, along with troops who were said to be advancing on an empty road toward Midan.

Another video showed a military helicopter flying over the Damascus neighborhood of Qaboun. The narrator could be heard saying the area was under "aerial bombardment," although the helicopter was not seen firing in the 30-second video.

The authenticity of the videos could not be independently verified.

The Britain-based Syrian Observatory for Human Rights and activist al-Shami said helicopters fired heavy machine guns during overnight clashes in the neighborhoods of Qadam and Hajar al-Aswad.

Al-Shami said residents of hard-hit areas were fleeing to safer neighborhoods where they were staying in schools and mosques. He added that many of the wounded were being treated at secret hospitals for fear they might be detained if taken to official ones.

Although the uprising began in March 2011 with largely peaceful protests, a government crackdown prompted many in the opposition to take up arms.

Now, the conflict is a full-blown civil war, and activists say more than 17,000 people have been killed. There are fears the violence and chaos could spread across the region.

On Tuesday, Israel's military intelligence chief warned that global jihadists have moved into Syrian territory bordering the Israeli-controlled Golan Heights and could soon use the area to stage attacks on the Jewish state.

Jordanian Foreign Minister Nasser Judeh said the kingdom was taking precautions to ward off a possible Syrian chemical attack, but declined to say what they were.

Also Tuesday, Iraq's government called for all its citizens in Syria to return home following the recent killing of two Iraqi journalists covering the conflict.

Thousands of Iraqis fled to Syria to escape widespread sectarian fighting during the worst of violence in their homeland between 2005 and 2007. Now, the traffic is heading the other way, with Iraqis and Syrian refugees heading east and out of the conflict that the International Red Cross has officially designated a civil war.

As the violence spirals out of control, diplomatic efforts to halt the bloodshed have seemingly come to a dead end. The U.S. and many Western nations have called on Assad to leave power, while Russia, China and Iran have stood by the regime.

Russia and China have veto power at the U.N. Security Council.

U.N. Secretary General Ban Ki-moon called for rapid, unified action by the Security Council on Syria as he arrived in Beijing on Tuesday as part of a diplomatic push to get Russia and China to back a tougher response to attacks by Assad's regime.

Ban's trip comes ahead of a Security Council vote Wednesday on whether to allow sanctions and authorize actions to enforce them that could ultimately include the use of military force, which U.S. and European officials are playing down as a possibility.

A Western-backed resolution at the Security Council calls for sanctions and invokes Chapter 7 of the U.N. Charter. A Chapter 7 resolution authorizes actions that can ultimately include the use of military force — something the Obama administration and European officials are playing down as a possibility.

As the violence in Syria escalates, the number of Syrians fleeing the bloodshed has swelled to some 112,000, according to the U.N. The U.N. refugee agency said women and children make up three-quarters of those has assisted in Iraq, Jordan, Lebanon and Turkey.

In addition, several recent defections by high-ranking Syrian officials have buoyed Western powers and anti-regime activists. Brig. Gen. Manaf Tlass, an Assad confidante and son of a former defense minister, who defected earlier this month, was confirmed Tuesday to be in France.