MARIUPOL/SLAVIANSK, Ukraine (Reuters) - Separatist rebels pressed ahead with a referendum on self-rule in east Ukraine on Sunday and fighting flared anew in a conflict that has raised fears of civil war and pitched Russia and the West into their worst crisis since the Cold War.
Clashes broke out around a television tower on the outskirts of the rebel stronghold of Slaviansk shortly before voters made their way to polling stations through streets blocked by barricades of felled trees, tires and rusty machinery.
"I wanted to come as early as I could," said Zhenya Denyesh, a 20-year-old student, second to vote at a concrete three-storey university building. "We all want to live in our own country."
Asked what he thought would follow the vote, organized in a matter of weeks by rebels, he replied: "It will still be war."
In nearby Mariupol, scene of fierce fighting last week, officials said there were only eight polling centers for half a million people. Queues grew to hundreds of meters and at one center voting urns were set out on the pavement against a wall.
Western leaders threatened more sanctions against Russia in the key areas of energy, financial services and engineering if it continued what they regard as efforts to destabilize Ukraine.
Moscow denies any role in the fighting or any ambitions to absorb the mainly Russian-speaking east, an industrial hub, into the Russian Federation following its annexation of the Black Sea peninsula of Crimea after a referendum in March.
Ukraine's Interior Ministry called the referendum a criminal farce, its ballot papers "soaked in blood". One official said that two thirds of the territory had declined to participate.
For a vote on which so much hangs, the referendum in the regions of Luhansk and Donetsk, which has declared itself a "People's Republic", seemed a decidedly ad hoc affair. Ballot papers were printed without security provision, polling stations were limited in many areas, voter registration was patchy and there was confusion on quite what people were asked to endorse.
Engineer Sergei, 33, voting in the industrial center of Mariupol, said he would answer "Yes" to the question on the ballot paper, printed in Russian and Ukrainian: "Do you support the act of state self-rule of the Donetsk People's Republic?"
"We're all for the independence of the Donetsk republic," he said. "It means leaving behind that fascist, pro-American government (in Kiev), which brought no one any good."
AUTONOMY, INDEPENDENCE, ANNEXATION
But in the same queue of voters, 54-year-old Irina, saw a "Yes" vote as endorsement of autonomy within Ukraine.
"I want Donetsk to have its own powers, some kind of autonomy, separate from Kiev. I'm not against a united Ukraine, but not under those people we did not choose, who seized power and are going to ruin the country," she said.
Some see a "Yes" vote as endorsement of autonomy within Ukraine, some as a move to independence and others as a nod to absorption by Russia.
Annexation is favored by the more prominent rebels, but the ambiguity may reflect their fears an explicit call for full "independence" might not have garnered the support they seek and could leave them in an exposed position towards Kiev.
The present government came to power when President Viktor Yanokovich was toppled in February by mass protests in Kiev.
Pro-Western activists were angered by his decision to discard a cooperation accord with the European Union in favor of closer ties with Moscow. They also accused him of massive corruption penetrating all areas of the Ukrainian state.
Voting is due to end in the hastily arranged referendum in 53 locations at 10 p.m. (1500 ET) and the rebels hope to have the ballots counted by Monday afternoon, although its outcome will not be widely recognized internationally or by Kiev.
It is not at all clear what action rebel leaders will take once the results, expected one way or another to show a large "yes" vote, have been announced. Any appeal to Russia could confront Kiev and the West with a serious challenge.
Ukrainian leader Oleksander Turchinov has urged eastern political leaders to join a "Round Table" discussion on devolution of powers in Ukraine. But he says he would not negotiate with "terrorists", a formulation meant to exclude most of the more prominent rebel leaders.
The Ukrainian Defence Ministry said rebels attacked their forces guarding a television tower on the outskirts of Slaviansk. One Ukrainian serviceman was wounded in fighting.
Sergei, a fighter speaking near an outer checkpoint, blamed
Ukrainian forces for the clash. "They are probably trying to put people off voting, but it won't work."
Presidential administration head Sergei Pashinski said Ukrainian forces had "destroyed" a separatist base and checkpoints in a broad operation around Slaviansk and nearby Kramatorsk in retaliation for attacks on their posts.
"This is not a referendum. This is a desultry attempt by killers and terrorists to cover their activity," he told a news conference.
PUTIN'S CALL IGNORED
Sunday's vote went ahead despite a call by Russian President Vladimir Putin on Wednesday to postpone it, a move that had raised hopes for an easing of tension.
The rebels in the east and the Kremlin say the pro-European Kiev government that replaced Yanukovich lacks legitimacy.
Kiev aims to banish such questions by holding a presidential election on May 25 but the West says Russia wants to disrupt it and threatened economic sanctions on Moscow over the weekend.
German Chancellor Angela Merkel and French President Francois Hollande said on Saturday they would back further sanctions against Russia if Ukraine's presidential election failed to go ahead because of disruption in the east.
Turchinov, who has ruled the referendum illegal and dismissed the allegations that the Kiev authorities are neo-fascists, said on Saturday any move to secession would be "a step into the abyss" and economic ruin.
The Metinvest company partially owned by Rinat Akhmetov, one of Ukraine's wealthiest businessmen with interests in the coal and steel industry in the east, said it was deploying a volunteer militia in Mariupol with workers from steel plants.
Last week Ukrainian forces battled rebels for control of the city and between seven and 20 people were killed before the Kiev forces withdrew, but disorders have continued.
Metinvest urged Kiev to refrain from sending troops on forays into the city if his militia maintained order.
"This militia will begin patrolling the streets of the city to protect peaceful civilians from marauders and criminals," the company said, adding opportunities for negotiation remained.