The Syrian military stepped up its battle to drive rebel forces out of Aleppo yesterday, firing artillery and mortars while a fighter jet flew over a district the army said it had retaken on Sunday.

However, opposition activists denied government troops had entered Salaheddine, in the south-west of Syria's biggest city.

Hospitals and makeshift clinics in rebel-held eastern neighbourhoods were filling up with casualties from a week of fighting in Aleppo, a commercial hub that had previously stayed out of a 16-month-old revolt against President Bashar al-Assad.

"Some days we get around 30, 40 people, not including the bodies," said a young medic in one clinic. "A few days ago we got 30 injured and maybe 20 corpses, but half of those bodies were ripped to pieces. We can't figure out who they are."

The Syrian Observatory for Human Rights claimed 18 people were killed in the Aleppo area on Sunday out of more than 150 people – two thirds of them civilians – slain across Syria.

Last night the United Nations said 200,000 people had fled the city in two days.

Outgunned rebel fighters, patrolling in trucks flying green-white-and-black "independence" flags, said they were holding out in Salaheddine despite a battering by the army's heavy weapons and helicopter gunships.

"We always knew the regime's grave would be Aleppo," said Mohammed, a young fighter, fingering the bullets in his tattered brown ammunition vest. "Damascus is the capital, but here we have a fourth of the country's population and the entire force of its economy. Assad's forces will be buried here."

An unidentified Syrian army officer said on state television on Sunday night that troops had pushed "mercenary gunmen" out of Salaheddine, adding: "In a few days safety and security will return to the city of Aleppo."

The army's assault on Salaheddine echoed its tactics in Damascus earlier this month when it used its overwhelming firepower to mop up rebel fighters district by district. Assad's forces are determined not to let go of Aleppo, where defeat would be a strategic and psychological blow.

A spokesman for the rebel Aleppo Revolution group said: "They were shelling the area at a rate of two shells a minute. We couldn't move at all. But it's not true that the regime's forces are in Salaheddine."

Warfare has stilled the usual commercial bustle in this city of 2.5 million. Vegetable markets are open but few people are buying. Instead, crowds of sweating men and women wait three hours to buy limited amounts of heavily subsidised bread.

Rebel fighters are in control of swathes of the city. But military experts say they are too lightly armed and poorly commanded to overcome the army.

The deputy police chief of Latakia, a city in western Syria, has fled to Turkey with 11 other Syrian officers. A Turkish official said another 600 Syrians had arrived at the weekend bringing the number of refugees in the country to around 43,500.

Jordan has also opened its first official refugee camp for people trying to escape the fighting in neighbouring Syria.