The Georgian military attacked South Ossetia's capital of Tskhinvali early in the morning with tanks, combat aircraft, heavy artillery and infantry, sparking condemnation from Russia, which has warned of "emergency measures" to end the conflict. South Ossetia earlier said 15 people had been killed in the attacks, several buildings were on fire in the city center, and the local parliament building had burned down
Georgian Reunification Minister Temur Yakobashvili said the military was continuing its offensive in Tskhinvali. However, he denied reports that Georgian planes had been bombing the city.
"There is no bombing of Tskhinvali. Street battles are continuing in the city, involving our soldiers. We do not plan to bomb our own servicemen in Tskhinvali," he told a video linkup hosted by RIA Novosti.
The rebel administration had said Georgian Su-25 Frogfoot attack planes had bombed the South Ossetian village of Kvernet as well as a humanitarian aid convoy.
Peacekeeping commanders in South Ossetia said a number of Russian peacekeepers were killed and wounded when Georgia shelled their headquarters in Tskhinvali, destroying several barracks.
Russian Prime Minister Vladimir Putin, currently on a visit to Beijing for the start of the Olympics, warned that Georgia's actions would meet a "response."
He said he had discussed the issue with U.S. President George W. Bush and top Chinese officials, who had agreed that full-scale war must be prevented.
The Georgian offensive came the morning after Georgian President Mikhail Saakashvili declared a unilateral ceasefire, and after the UN Security Council gathered for an emergency meeting.
At the Security Council session, Russia's UN Ambassador Vitaly Churkin called on the council to intervene to stop violence in the region.
The Kremlin also held emergency talks on the conflict, and said it was considering urgent measures to end the attack on South Ossetia.
Russian President Dmitry Medvedev "is heading a meeting to discuss a series of urgent measures to stop the violence in South Ossetia, to protect the civilian population and Russian citizens in the conflict zone," the Kremlin press service said.
Georgian Prime Minister Vladimir Gurgenidze said Georgia would continue its military operation until peace was established.
"The goal of Georgia's actions in the conflict zone is to establish peace in the region. And we will not stop until we have attained this goal," he said. (VIDEO)
He said the country would offer an amnesty to South Ossetia's leaders, and provide over $35 million in reconstruction aid for province.