Jakarta-based Radio Elshinta reported at least 10 policemen were sent to nearby hospitals, and a police spokesman said two of them later died.

A large crowd gathered outside the compound, which houses an elite Mobile Brigade.

Indonesia has been on heightened alert since the United States and Australia warned last week of possible attacks on Westerners in the country.

Militants linked to al Qaeda have carried out several major bomb attacks on Western targets in Indonesia in the past few years.

"So far, five deaths are confirmed from the miscreants' side. It may be higher than this," Sultan told Reuters of Tuesday's violence. He said 15 militants also surrendered.

Sultan said fierce fighting was going on to drive out militants holed up in fortress-like compounds.

"Helicopter gunships have been flying in and out of Miranshah toward Shawal since morning," a resident of Miranshah said.

Shawal, an upland valley with forests and meadows, is about 50 km (30 miles) west of Miranshah. Officials say the area is used as a safe haven by militants who escaped military operations in neighboring South Waziristan region in 2004. Hundreds of security forces and militants were killed in those battles.

Intelligence officials said three troopers were injured in a separate attack in the nearby Datta Kheil area.

On Monday, five people were killed in a land mine explosion and two militants died in a clash with security forces in the area.

President Pervez Musharraf, a key ally in the U.S.-led war on terrorism, last month warned foreign militants hiding in the tribal region to leave Pakistan or face annihilation.

A large number of al Qaeda remnants and Taliban fled to Pakistan's semi-autonomous tribal belt after U.S.-led forces toppled the radical Taliban regime in Afghanistan following the September 11, 2001 attacks on Washington and New York.

The government of King Gyanendra has banned rallies in Kathmandu, the center of the campaign, and vowed to crush any protests, saying that it had evidence Maoist rebels would use the occasion to infiltrate the capital.

Witnesses said about two dozen lawyers, journalists and doctors were detained when they defied the ban and staged a small protest on Wednesday morning.

Police also raided the homes of several political leaders and activists in a pre-dawn crackdown and detained many of them, party officials said.

"I have been handed over a detention order saying I am being detained for 90 days under the Public Security Act," Minendra Rijal, a senior member of the Nepali Congress (Democratic) party, told Reuters by telephone as he was pulled from bed and taken away by police.

Although anti-monarchy protests have become a regular feature in the country since the king's coup in February 2005, the latest rallies are expected to be the biggest so far.

The campaign has also gained weight as it comes after the political parties and Maoist rebels ironed out their differences and reaffirmed their commitment to a loose alliance struck last November that seeks to end the king's absolute rule.

On Monday the Maoists, who have fighting since 1996 to establish a communist republic, responded to an appeal by political parties by ordering a unilateral cease-fire in Kathmandu Valley. They have urged people to support the protests but said they would not attend themselves.

Political parties have vowed to defy the ban, and have urged schools, businesses and factories to close, and public transport and private cars to stay off the streets.

"The end of autocracy and the establishment of full-fledged democracy are our goals," said Girija Prasad Koirala, president of the biggest political party, Nepali Congress.

"We want peace and prosperity in Nepal. Our protest movement will not end until we achieve them."

Many trade union and professional groups said they would join the strike, while schools and businesses are likely to close, either in support of the strike or for fear of attacks by activists.

LOOSE ALLIANCE

Last November's unprecedented alliance between Maoist rebels and the country's seven main political parties has left King Gyanendra looking even more isolated, analysts say.

Under the deal, struck after months of secret negotiations, the Maoists have promised to eventually rejoin the political mainstream.

Parties and rebels promised to work together to end what they call "the autocratic monarchy," without explaining how they would do so. But the two sides continue to have divergent visions on the political system they would like to see replace royal rule.

The rebels have a strong presence in the countryside where they run their own administrations. They enjoy some support among the rural poor, but also enforce their rule through fear and intimidation.

The revolt, which has claimed 13,000 lives since 1996, has scared away tourists as well as investors from the cash-strapped nation and undermined its aid dependent economy.

The Manila-based Asian Development Bank, a key aid donor, says economic growth slowed to 2.0 percent in the year ending July 2005, from 3.5 in the previous year and 4.8 in 2001.

King Gyanendra says he took over only after the parties failed to quell the revolt, and has refused to budge.

In February, he held municipal elections which were boycotted by the parties and opposed by the Maoists, and turnout was low. He has also laid out "a roadmap for democracy" under which national elections are expected to be held by April 2007.

But a recent opinion poll conducted by Himal, a popular magazine, showed 65 percent of those surveyed did not approve of the king's direct rule. Many Nepalis are tired of the stalemate and want the king, the political parties and the Maoists to end their fighting and join together for peace.

"I don't think it can be resolved otherwise. The crisis is spreading like cancer," said 33-year-old taxi driver, Manjil Maharjan. "I want nothing else but peace so that I can work and make a living without any trouble."

While the move was applauded by Thaksin's critics who have tried to oust him since February, his imminent departure leaves political players scrambling for a strategy.

"We are meeting in order to map out the party's standpoint because of the current political situation," said opposition Democrat party spokesman Ong-art Klampaiboon ahead of talks later Wednesday.

It is still unclear when Thaksin will actually leave the post he has held since 2001. Parliament cannot convene until by-elections for 39 districts are held on April 23 and all 500 seats are filled.

Until then Thaksin will remain as caretaker and a new prime minister cannot be confirmed, promising weeks of political limbo.

"The next big step is how (to resolve) what happened with the results of the current election," said John Brandon, director of international relations at the Asia Foundation.

Democrat party secretary Sutsep Thuagsuban praised Thaksin for stepping down and said the opposition would likely cooperate with the premier's Thai Rak Thai (Thais Love Thais) party to find a way out of the political crisis.

The Democrats will "assess the political situation to decide what the party can do in order to create a conciliatory climate," said party secretary Suthep Thuagsuban Wednesday.

Thaksin had come under increasing pressure to quit since January, when public anger erupted over his family's 1.9-billion-dollar tax-free sale of its stock in Shin Corp., the telecom giant Thaksin founded before entering office.

His critics staged weeks of street protests demanding he resign for alleged corruption and abuse of power, while his political rivals -- led by the Democrats -- boycotted the elections that were seen as a referendum on the premier's leadership.

Thaksin's decision to resign is expected to usher in a months-long process of constitutional reform, with an interim government running the country until new elections can be organized.

Although he did not mention any plans for the future in his address Tuesday night, both Thaksin and the political opposition have spoken of creating a special assembly that would amend the constitution -- essentially to weaken the powers of the prime minister.

Once the new parliament convenes, Thaksin has said the reform process could take up to 15 months before new elections, which the opposition will contest.

Even a lengthy period of political reforms under a caretaker government was preferable to the standoff that had gripped Thailand for two months, said Kiatphong Noijaiboon, a vice chairman of the Federation of Thai Industries.

"After the parliament convenes, political reforms can move forward," Kiatphong said.

"It will be much easier for the opposition parties to run in the new election to make sure Thai democracy works properly."

The former telecoms tycoon said in his 10-minute televised live statement late Tuesday that he would step down out of respect for King Bhumibol Adulyadej.

Thaksin mentioned the king several times in his remarks, suggesting a possible royal intervention to halt the spiralling political crisis as the monarch prepares to celebrate his 60th year on the throne.

The premier Wednesday bid farewell to thousands of supporters at his party headquarters, thanking them for their support and promising not to disappear from politics.

Firefighters were responding to a car fire down the street before dawn when they saw smoke coming out of the three-story brick building, Assistant Fire Chief Mike Darnell said. A second fire truck had to be called to reach the top floor because the truck responding to the car fire did not have a long enough ladder.

Carl Bell, the boyfriend of the victims' mother, said the children were crying for him to help them. He said he tried to rescue them but was driven back by intense heat.

Eight people were in the building at the time of the fire. Three adults, including the children's mother, and an infant were taken to a hospital, Gray said. He did not know their conditions.

The cause of the fire was not immediately clear, but arson investigators could be seen through the broken windows. Gray said the fire appeared to have started on the second floor, where there were apartments.

Patricia Evans, the children's grandmother, could barely speak as she sobbed outside the hospital where their bodies were taken.

"It hurts so bad. I'm empty," she told television station WKYC. "We have no money to bury them. I want the city of Cleveland to pray for me and my family."

Autopsy results were expected Wednesday.