“They came with battle wagons and trucks all full of soldiers and guns,” said Hassan Abdi, a resident in the town of Balanbale in Galgadud region. “Everybody is very worried.”

Residents said the Ethiopian troops were setting up positions in the center of the town. Central Somalia has been the scene of heavy fighting between hardline Islamist insurgents and the moderate Islamist group Ahlu Sunna Waljamaca.

“We are ready to fight the Ethiopians if they come close to our forces, we will give them a lesson,” Hassan Maalin Takow, an al Shabaab commander told Reuters.

Al Shabaab and allied group Hizbul Islam is trying to oust the government of President Sheikh Sharif Ahmed, a former Islamist rebel who was elected in January, and impose a strict version of Islamic law throughout the Horn of Africa nation.

The insurgents control large swathes of the south and parts of the capital Mogadishu. They have been battling pro-government forces this month in a bid to stamp more authority on the center of the Horn of Africa nation.

NO INTENTION OF GOING INTO SOMALIA

Ethiopia sent thousands of troops into Somalia in 2006 to help topple an Islamist movement holding Mogadishu and most of the south. That drew protests from some in the Muslim world and enraged the Islamists, who regrouped to launch an insurgency.

The Ethiopian soldiers withdrew in January but residents, insurgents and humanitarian organizations have reported several incursions in the past few months.

Addis Ababa initially denied any soldiers had crossed into Somalia but said earlier this month military personnel had been carrying out “reconnaissance” missions into its neighbor.

“Ethiopia has no intention to go back into Somalia. That is the standing position of our government,” the Ethiopian government’s head of information, Bereket Simon, told Reuters on Friday when asked about reports of new incursions.

He will be holding a regular news conference on Saturday.

The Ethiopian troops were deeply unpopular in Somalia and their two-year presence helped rally support for the insurgents.

Since withdrawing, Ethiopia has left a heavy military presence along its border with Somalia and has been keeping a close watch on the ebb and flow of fighting between the rebels and pro-government forces.

It is wary of having a hardline Islamist state next door and Western nations fear al Shabaab, which has links to al Qaeda, could use southern Somalia as a base to destabilize neighbors such as Kenya and Ethiopia.

People living in the southwestern Somali region of Bakool, which is controlled by hardline Islamist rebel group al Shabaab, said Ethiopian troops moved into a village called Washaga on Friday and residents were fleeing.

“I’m now packed up to leave the village, al Shabaab and the Ethiopians are close to each other and on the verge of fighting,” said resident Fatima Isaq Madey.

(Additional reporting by Mohamed Ahmed and Ibrahim Mohamed in Mogadishu, Barry Malone in Addis Ababa, Writing by David Clarke)