As night fell, booming explosions and the sound of gunfire rattled around major intersections in the central business district. Local TV reported that several grenades hit a shopping center and elevated-rail station. Plumes of black smoke hung over the neighborhood as tires burned in eerily empty streets while onlookers ducked for cover.

With security deteriorating and hopes of a peaceful resolution to the standoff increasingly unlikely, what was once one of Southeast Asia's most stable democracies and magnets of foreign investment has been thrust deep into political uncertainty. The crisis threatens its stability, economy and already-decimated tourism industry.

Violence escalated after a rogue army general regarded as a military adviser to the Red Shirt protesters was shot in the head Thursday evening, possibly by a sniper. A doctor said Maj. Gen. Khattiya Sawasdiphol was still in a coma Friday and he could “die at any moment.” Clashes since then have killed 10, officials said. Among those wounded were two Thai journalists and a Canadian reporter, who was in a serious condition.

“We are being surrounded. We are being crushed. The soldiers are closing in on us. This is not a civil war yet, but it's very, very cruel,” Weng Tojirakarn, a protest leader, told The Associated Press.

Fighting has now killed 39 people and injured hundreds since the Red Shirts, mostly rural poor, began camping in the capital on March 12, in a bid to force out Prime Minister Abhisit Vejjajiva. They claim his coalition government came to power illegitimately through manipulation of the courts and the backing of the powerful military, which in 2006 forced the populist premier favored by the Red Shirts, Thaksin Shinawatra, from office in a coup.

Last week, Abhisit offered November elections, raising hopes that a compromise could be reached with the Red Shirts, who have been demanding immediate elections. Those hopes were dashed after Red Shirt leaders made more demands.

Late Thursday, the army moved to seal off the Red Shirt encampment in an upscale commercial district of the capital. Some 10,000 protesters, women and children among them, have crammed into the area.

“Our policy is not to disperse the protesters,” government spokesman Panitan Wattanayagorn said late Friday. He said their mission was to set up checkpoints and “tighten” the area around the protest, but “there have been attempts to agitate the officers.”

In a later speech on national TV, Panitan said security forces had not entered the demonstration area but were attacked and forced to protect themselves. He said security efforts would be stepped up in the coming days and “many areas would be under control soon.” As he said that a large explosion rang out in central Bangkok.

Friday's violence was initially centered on a small area home to several foreign embassies, including those of the United States and Japan which were forced to close, but by mid-afternoon had spread around the three sq km protest zone barricaded with bamboo stakes and tires. The British, New Zealand and the Dutch embassies, which are in the vicinity, also were shut.