Northern forces held the strategic area late on Saturday with 5,000 troops and tanks, sparking fears of a new north-south conflict just as south Sudan prepares for independence in July. Both north and south claim the oil-producing region as theirs.
About 20,000 people — almost the entire population of Abyei — have fled the fighting and are heading south, aid workers said, adding that scores of them had been wounded in the fighting.
The United Nations said its base had been hit by mortars and that there had been reports of looting by armed groups. The UN security council has called off a visit to Abyei planned for today.
By moving troops in on the town, the north was starting a war said Col Philip Aguer from Southern Sudan’s army, calling for the UN to step in.
"We didn't declare war. The [Sudanese ruling] National Congress party and the Sudan armed forces declared war on us," Aguer told the Associated Press.
"If the international community do not intervene quickly to rescue the situation then this is a complete violation of the comprehensive peace agreement, a complete violation of the ceasefire, and it is a declaration of war by Khartoum," he told the BBC.
The northern army said it had moved in after 22 of its personnel were killed in an ambush by southern armed groups last week. It said it had sent in the troops to clear out southern soldiers that it said had gone in to the area breaking earlier agreements.
The southern army meanwhile said the north had shelled villages and that it had withdrawn its troops from Abyei after the north moved in.
The trouble comes just two months before Sudan is due to split in two, and threatens to plunge the country back into fighting. Abyei was ruled by a joint body made up of northerners and southerners. Most people living in the north are Muslim, while most in the south are Christian and those with animist beliefs. In January, southerners voted overwhelmingly to become independent, which would make them the world's newest nation.
Fighting in the north eastern African country has killed at least two million people, and forced four million people from their homes. About 90 percent of people in Sudan live below the poverty line. And in Southern Sudan, one in seven children dies before their fifth birthday, according to figures from Save the Children.