MOSCOW, August 3, 2008 (AFP) - Georgia's Moscow-backed breakaway region of South Ossetia is close to a 'large-scale' military conflict, Russia said on Sunday, adding that Georgian manoeuvres were undermining peace prospects.

'The threat of large-scale military action between Georgia and South Ossetia is becoming ever more real,' Russia's foreign ministry said.

'Despite various declarations by the Georgian leadership on the need for urgent measures to reduce tension, in practice Tbilisi's actions undermine these declarations,' the ministry said in a statement.

The statement called on both sides to show 'maximum restraint.'

'They should, in a spirit of good will, direct their efforts to resolving the crisis situation and preventing its deterioration,' the statement said.

Russia's comments came after the South Ossetian rebel administration said six people had been killed in a Georgian military assault overnight Friday.

Tbilisi insisted it had opened fire only in response to firing from South Ossetian grenade launchers and denied rebel claims that Georgia had deployed snipers to attack rebel positions.

Georgia accuses Moscow of propping up the rebel leadership in South Ossetia and another separatist territory, Abkhazia, notably through large Russian peacekeeping contingents that are based in both areas.

The pro-Western Georgian leadership of President Mikheil Saakashvili is embroiled in a row with Soviet-era master Moscow over Georgia's plans to join the NATO military alliance, plans that Russia vehemently opposes.

In its statement, Russia echoed claims by South Ossetia that Georgia had engaged in large-scale military manoeuvres overnight close to South Ossetia.

On its website the South Ossetian information agency said Georgia's military had opened fire on several South Ossetian villages overnight, although without a repeat of the injuries of the night before.

The Russian foreign ministry again rejected Georgia's diplomatic drive for the removal of Russian peacekeepers, saying current instability made any such move 'especially counterproductive and dangerous.'

The South Ossetian authorities said they were continuing the evacuation of women and children from vulnerable areas, transporting them across the border to the neighbouring Russian province of North Ossetia.

South Ossetian education minister Zamira Dzhioyeva said a first group of 1,000 children had been evacuated to North Ossetia on Sunday.

'This step has been brought about by the fact that our children are in constant danger, which has a negative effect on their unformed psyches and simply threatens their lives,' she was quoted by the information agency as saying.