Tegen Wanti, a Nimba County resident reached by satellite telephone, said people of the town of Bahn had heard nothing about the deaths of 1,000 people that state radio had reported.
Meanwhile, a force of 150 U.S. Marines returned to their warships off Liberia's coast Sunday, insisting shipboard troops would be better positioned to respond to any flare-ups in the country's still-gelling peace accord.
Liberian radio gave neither details nor sources for its report on the deaths Sunday night, beyond saying the alleged massacre was carried out last week in Bahn by rebels of the nation's second, smaller insurgent movement.
Liberian Information Minister Reginald Goodrich and Defense Minister Daniel Chea said they had no information on any such massacre.
Wanti, a former Liberian diplomat, told The Associated Press that rebels of the smaller Movement for Democracy in Liberia movement had killed at least 27 people Friday in his home village of Florlay, in Nimba County, near Bahn.
"The military situation here is more serious than thought in Monrovia. We have a terrible situation here," Wanti said, saying many people had taken refuge into forests to flee the fighting.
Nimba is near the border with Ivory Coast and Guinea, both countries widely accused of backing rebels in Liberia.
A more than 3-week-old West African peace mission has quelled fighting in Liberia's capital, after a 4-year-old rebellion that ultimately forced out President Charles Taylor earlier this month.
Peacekeepers have yet to deploy more than a few dozen miles outside the city, however.
The unannounced U.S. departure ended a significant U.S. military deployment on the ground after just 11 days.
The withdrawal left about 100 U.S. troops still on the ground — 70 guarding the U.S. Embassy, and 30 working as a liaison team with a 3-week-old West African peace force, Lt. Col. Tom Collins, spokesman for the 26th Marine Expeditionary Unit force, told The Associated Press.
President Bush put the rapid-reaction force on the ground Aug. 14, under international pressure to intervene to quell bloodletting in Liberia, a nation founded by freed American slaves with U.S. government backing in the 19th century.
Mr. Bush always stressed their deployment would be temporary and limited to supporting West African peacekeepers. The president has expressed concern about overstretching a military already committed to large operations in Iraq and Afghanistan.
The peace accord — signed in Accra, Ghana, after 2½ months of talks repeatedly sidelined by new fighting — commits Liberia to a two-year transition government. Liberia's political parties and civil groups began implementing the first part of the deal Aug. 19.
Nevertheless, reports of clashes in northern and southeastern Liberia have persisted. The reports are impossible to verify independently, and all sides routinely accuse their rivals of beginning the fighting with new attacks.
Chea, the defense minister, called the situation "still pretty tense." Fighting was concentrated at a bridge between Bong County and Nimba County, he said.
Rebels had made a base in Nimba County, before being driven out by government forces several months ago.
Nimba is rich in diamonds, and Bahn is one of the main mining towns.
Reports of clashes there heightened worries of battles for spoils and revenge by Liberia's former warring sides, none of them well-disciplined.
Col. Theophilus Tawiah of Ghana, chief of staff of the West African force, said peacekeepers had no independent assessments of the reports of fighting.
According to the BBC, there was also fighting in Gbarnga, 100 miles northwest of Monrovia and Harbel, 40 miles from the capital city.