Rwandan-backed rebels marched into east Congo's largest city Goma on Monday and Congolese troops exchanged fire with the Rwandan military across the border, in the worst escalation of a long-running conflict for more than a decade.

The M23 militia, funded and directed by Rwanda, said it had seized the city of Goma, terrifying its people, many of whom sought shelter there after fleeing the rebel advance.

M23 rebels in the Democratic Republic of Congo were reported to have taken the key eastern city of Goma in fierce fighting with government forces that sent streams of refugees fleeing area communities.