Islamic insurgents in Somalia seized a major agricultural center overnight, sending hundreds of people fleeing, a human rights leader said Saturday. The attack underscored the government's vulnerabilities, as U.N.-sponsored peace talks stalled in neighboring Djibouti. Ali Bashi, of Fanole rights group, said the Islamic Courts Union ousted militiamen loyal to Somalia's fragile government from Jilib overnight and were patrolling the southern town Saturday. Two militia fighters were killed and three others were wounded in the fighting, he said, citing reports from his office in Jilib.

Jilib resident Mohamed Sandhere said he saw two dead government fighters near a checkpoint and five others, including two civilians, who were badly wounded.

After the insurgents entered the town from several directions, the two sides fought with guns and rocket-propelled grenades. The Islamic militants seized some weapons and equipment from the government side, including four armored trucks, said witness Elmi Ali.

Hundreds of refugees were streaming out of the town Saturday.

"These people already had fled from fighting in Mogadishu and today again were forced to flee because they fear more violence," Bashi told The Associated Press in a telephone call from southern Kismayo town. Jilib had a population of about 5,000 before the influx of people displaced from the capital.

The town is in a volatile area where two foreign U.N. contractors were abducted months ago. The Briton and Kenyan still are missing.

Somalia's weak U.N.-backed government has been struggling to quash a re-emerging Islamist insurgency. In December 2006, neighboring Ethiopia sent troops that still are propping up the government. Thousands of civilians have been killed and hundreds of thousands forced from their homes in a burgeoning humanitarian crisis.

Somalia has been without a functioning government since 1991, when clan warlords ousted longtime dictator Mohamed Siad Barre and then turned on each other, creating chaos in the Horn of Africa nation.

Islamist insurgents have intensified attacks since a U.S. airstrike May 1 killed the alleged al-Qaida (web|news) leader in Somalia.

The U.N. Security Council unanimously approved a resolution Thursday calling for a U.N. political presence in Somalia for the first time in years and said it would consider deploying U.N. peacekeepers to replace African Union troops, if there is improved political reconciliation and security.

But another round of peace talks ended in Djibouti on Friday with no more than an agreement to meet again May 31. U.N. negotiators failed to organize direct talks between the government and the biggest opposition alliance, which supports the insurgency.

The Alliance for the Re-Liberation of Somalia said it would not be involved in direct talks until the government agrees to a timetable for Ethiopian troops to withdraw. Without Ethiopian support, it is feared the government would fall.

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Associated Press Writer Mohamed Sheikh Nor contributed to this report.