At least 30 people were killed and almost 83 others were wounded Thursday as the fierce fighting continues between Somali government forces backed by African Union (AU) peacekeeping troops and Islamist insurgent fighters in Mogadishu, medical sources said.

The fighting which erupted on Wednesday resumed in the early hours of Thursday morning after it briefly stopped overnight with both sides claiming successes.

"As many as 30 people were killed, 12 of them in one area in the north of Mogadishu while we have picked almost 83 wounded people including 35 children mainly in the northern districts of Mogadishu," Ali Muse, head of local ambulance service told Xinhua.

Heavy artillery and intense gunfire was heard around the battle areas in the north of Mogadishu where witnesses said several shells landed in residential neighborhoods.

Families in residential pockets in the north began fleeing their homes to join hundreds of thousands of displaced civilians on the outskirts of coastal Indian Ocean city of Mogadishu.

Somali government military commanders as well as insurgent fighters have claimed to have achieved ground from the other side but that cannot be independently verified as the battle still rages in north Mogadishu.

The latest upsurge in fighting comes as speculation intensifies of a major government offensive to retake the capital from rebels who control more than half of the restive coastal city.

Somali government controls only parts of the capital Mogadishu while Islamist groups rein over large swathes of territory in the south and centre of war-ravaged horn of African nation.

The U.S. pledged to support Somali government plans to wrestle control of Mogadishu from Islamists who are poised to oust the weak but internationally recognized government of Somalia.