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Residents in Russia's Belgorod region who have fled their homes due to fighting there have been urged not to return yet.
Russian officials say an armed "sabotage" group crossed from Ukraine and attacked the Grayvoronsky district by the border on Monday.
Moscow has now launched a terrorism investigation as fighting continues.
Ukraine denies responsibility and said Russian citizens from two paramilitary groups were behind the incursion.
No deaths have been reported in the fighting but a number of people are believed to have been injured.
That includes two civilians amongst those being evacuated, the region's governor, Vyacheslav Gladkov, said on Tuesday.
He added that air defences had shot down drones overnight, damaging buildings.
The BBC has verified that a building used by Russia's main security agency, the FSB, was among those hit. It is not clear what caused the damage.
Mr Gladkov said that people in several villages had been evacuated and warned those who had fled their homes not to return yet, as Russian forces carried out what he described as a "mopping up" operation.
Monday's raid appears to have been one of the largest cross-border incursions since Russia's full-scale invasion of the country 15 months ago.
It lead Moscow to declare a counter-terrorism operation in Belgorod - giving the authorities there special powers to clamp down on communications and people's movements.
Ukrainian officials said those behind the ongoing incident were from groups called the Liberty of Russia Legion and the Russian Volunteer Corps (RVC).
The Liberty of Russia Legion - a Ukraine-based Russian militia which says it is working inside Russia to overthrow President Vladimir Putin - said on Twitter on Monday it had "completely liberated" the border town of Kozinka.
It said forward units had reached the town of Grayvoron, further east.
Mr Putin's spokesman Dmitry Peskov said that while "there are many ethnic Russians living in Ukraine... they are still Ukrainian militants".
Mr Peskov added that their purpose was to draw attention away from the eastern Ukrainian city of Bakhmut.
The Russian mercenary Wagner group has recently claimed to have taken control of the city after months of intense and bloody fighting.
However, Kyiv insists it still controls parts of it. Deputy Defence Minister Hanna Maliar said on Tuesday that fighting in Bakhmut had decreased - although shelling was continuing in the area around it.