The military, which seized power from an elected government in a 2021 coup, is battling a co-ordinated offensive launched last month by an alliance of three ethnic minority insurgent groups, as well as allied pro-democracy fighters who have taken up arms since the coup.
"The military attacked Pauktaw town with helicopters and artillery fire from a navy ship after we conquered the police station of the town in the morning," the Three Brotherhood Alliance said on its Telegram channel, referring to the fighting in western Myanmar's Rakhine State on Thursday.
"In the evening, junta troops came into the town and shot and killed civilians," the alliance said.
Reuters could not independently verify the report and the junta did not respond to request for comment.
Pauktaw is about 500km northwest of Myanmar's main city of Yangon.
The offensive, which the insurgent alliance calls "Operation 1027" after the date it was launched, is the biggest the junta has faced in years.
Three rebel groups, aligned with pro-democracy fighters and a parallel, pro-democracy civilian government, have captured several towns and military posts across the country.
The Irrawaddy news portal, citing a resident of Pauktaw, said members of the Arakan Army (AA) guerrilla group had earlier taken control of the town.
Fighting has also broken out in Shan State on the border with China where the insurgents have pledged to wrest control of the area from the junta and eradicate online scam centres run illegally there.
In the weeks before the clashes, Chinese officials called on the junta to take stronger action against the scam centres where Chinese and other foreign nationals have been known to be trapped as victims of human trafficking.
Junta spokesperson Zaw Min Tun accused the rebel alliance of trying to get China's support for their cause.
"China is really keen to eliminate online scam activities, and (the alliance) is using that situation with a strategy to gain benefits for their organisation," he said in a statement on Thursday.
Junta state media said on Friday it had handed three Chinese nationals accused of running scams over to China, while a fourth suspect shot himself after being captured.
The Chinese government could not immediately be reached for comment.
Dozens of junta troops have surrendered in the fighting, according to rebel forces and a video verified by Reuters, and more have fled into neighbouring India.
The junta says it is battling terrorists and has ordered all government staff and those with military experience to prepare to serve in case of emergency.
