Fighting raged on the second day Sunday of a fierce government offensive against rebels in Aleppo, as the UN said 200,000 civilians had fled Syria's most populous city in two days and many were trapped.
The opposition Syrian National Council (SNC) accused the government of preparing to carry out "massacres" in the northern city and pleaded for heavy weapons to enable rebels to meet the regime onslaught.
The SNC also urged the UN to hold an emergency session to discuss ways to protect civilians caught up in the conflict.
Syrian Foreign Minister Walid al-Muallem, on a surprise visit to key ally Iran, said the rebels "will definitely be defeated" in Aleppo, even as a Free Syrian Army (FSA) commander boasted the city would become a "graveyard" for the army's tanks.
"There are clashes on the edges of... Salaheddin" which regime forces were pounding with helicopter gunships, the Observatory's Rami Abdel Rahman told AFP.
Abdel Rahman described the situation in Aleppo as "a full-scale street war," with fighting also in the neighbourhoods of Arkub, Bab al-Hadid, Fardoss, Jisr al-Hajj, Sukari, Zahraa, Zebdiyeh, at the Al-Hindrat Palestinian refugee camp, and Bustan al-Qasr district which was being pounded by helicopter gunships.
The Britain-based Observatory said that "the sound of heavy machinegun fire and explosions" could be heard in Salaheddin late on Sunday but gave no further details.
Rebels broke into a juvenile detention centre "in order to set the prisoners free," he said, adding displaced families were having difficulty finding refuge "because nowhere is safe any more."
After massing for two days, troops backed by tanks and helicopters on Saturday launched a ground assault on Salaheddin, where rebels concentrated their forces when they seized much of Aleppo on July 20.
Both sides claimed to have made advances, but an AFP correspondent reported rebels had largely repulsed the army when it launched its first onslaught.
Civilians in the city of some 2.5 million crowded into basements seeking refuge from the intense bombardment by artillery and helicopters, the correspondent said.
UN humanitarian chief Valerie Amos said in a statement that 200,000 people have fled from Aleppo in two days and an unknown number of them were still trapped in the city.
Amos said in New York that she was "extremely concerned by the impact of shelling and use of tanks and other heavy weapons" on civilians in Aleppo, Damascus and other locations.
She said that many people in Aleppo had sought shelter in schools and other public buildings. "They urgently need food, mattresses and blankets, hygiene supplies and drinking water," she said.
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Colonel Abdel Jabbar al-Oqaidi, FSA commander for Aleppo, said the rebels had inflicted heavy losses on the army in Salaheddin but that there had been many civilian deaths.
"Aleppo will be the graveyard of the tanks of the Syrian army," Oqaidi told AFP in an interview conducted at an isolated farmhouse surrounded by olive groves near the city.
"We ask the West for a no-fly zone" in order to prevent aerial raids by Assad's forces, he said.
The colonel said his men were positioned across Aleppo and would not withdraw as they had when they came under intense fire from regime troops in Damascus earlier this month.
"There is no strategic withdrawal of the Free Syrian Army. We await the attack," he said, while refusing to reveal how many rebels are fighting in Aleppo.
"We expect (the army) to commit a very great slaughter, and we urge the international community to intervene to prevent these crimes," the colonel said.
The Observatory reported that 67 people were killed across the country on Sunday.
In Tehran, Muallem vowed regime forces would crush the rebels in Aleppo.
"We believe that all the anti-Syrian forces have gathered in Aleppo to fight the government... and they will definitely be defeated," he told a joint news conference with Tehran's Foreign Minister Ali Akbar Salehi.
As the rebels faced the superior firepower of Assad's regime, SNC chief Abdel Basset Sayda called on foreign governments to provide them with heavy weapons.
"We want weapons that would stop tanks and jet fighters," Sayda said after talks in Abu Dhabi.
The SNC also called on the Security Council to hold an emergency session on the situation in Aleppo, Damascus and Homs and urged it to "take action to provide civilians with the needed protection from brutal bombing campaigns."
Peace envoy Kofi Annan urged both sides to hold back, saying only a political solution could end a conflict that rights activists say has killed more than 20,000 people since the uprising erupted in March 2011.
"The escalation of the military build-up in Aleppo and the surrounding area is further evidence of the need for the international community to come together to persuade the parties that only a political transition, leading to a political settlement, will resolve this crisis," he said.