A wounded man is brought to Madina hospital in Mogadishu April 20, 2008. REUTERS/Ismael Taxta

MOGADISHU (Reuters) - The death-toll from battles between Islamist-led insurgents and allied Ethiopian-Somali troops rose to 85 on Monday, leaving corpses on the streets and deepening the Horn of Africa nation's humanitarian crisis.

After mortars and machine-gun fire rocked Mogadishu over the weekend in the worst fighting for months, Islamist fighters seized the southern coastal town of Guda, killing four Somali soldiers and wounding at least seven more, locals said.

"The town is under their control at the moment," politician Omar Abdullahi Farole told Reuters from the area.

That attack at dawn on Monday added to at least 81 people dead in Mogadishu over the weekend.

The rebels have in the last few months launched an increasing number of hit-and-run raids on small towns -- seizing control from local government-allied militias, only to melt away before reinforcements arrive.

Analysts say the Islamists' militant al Shabaab wing is behind the attacks, which appear to be a show of strength designed to stretch the Ethiopian and Somali troops, rather than an attempt to win and hold territory.

Islamist fighters took another town, Dinsor, in south-central Somalia, on Monday. And they imposed sharia law on another locality, Wajid, taken in the same area at the weekend.

"They warned the public against erecting illegal checkpoints, smoking cigarettes, chewing (the narcotic leaf) khat and watching movies," Wajid resident Aden Abdirahman said.

Washington last month put Shabaab on its terrorism list.

Backed by Ethiopia, Somali President Abdullahi Yusuf's interim government drove the Islamists out of Mogadishu at the end of 2006, but has since then faced an Iraq-style insurgency of near-daily assassinations and roadside bombings.

The violence has swelled an internal refugee population of about one million. The weekend fighting in Mogadishu was mainly in the already largely deserted north of the city, but Reuters reporters saw scores of Somalis heading out of the capital.

TRAPPED IN MOSQUE

Once again in the city's violent history, bodies lay on the streets uncollected.

"This morning as I was trying to escape the fighting which I feared might restart, I saw four dead men I knew lying in the neighborhood," resident Hussein Abdulle said by telephone.

Another resident, Abdulahi Mohamud, said at least 20 people -- mostly women and children -- were trapped in a mosque where Ethiopian tank crews had dug deep defensive trenches.

"Two Somalis who have been beheaded are also lying there," Mohamud said from the northern district of Huruwa.

Meanwhile, police on Monday arrested an editor with the Shabelle radio station accusing him of airing false information regarding the fighting.

"He reported that Islamist forces attacked and seized Gulwade compound where police are staying. It was a lie since no fighting took place there. We will put him on trial for airing false reports to the public," police commander Abdulkadir Mohamed Abdullahi told Reuters.

Colleagues gave the editor's name as Abdi Mohamed Ismail and said he was arrested on his way to the office early on Monday.

The Elman Peace and Human Rights Organisation, a local group which tracks the violence, says at least 81 people were killed and 119 wounded in the clashes on Saturday and Sunday.

Its researchers estimate that some 6,500 residents were killed last year by fighting in the capital alone, while 1.5 million were uprooted from their homes.

Aid workers say 250,000 civilians sheltering in squalid conditions just outside Mogadishu represent the biggest group of internally displaced people in the world.

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