Thai troops and armored vehicles converged early Wednesday around the barricaded encampment of anti-government protesters in downtown Bangkok and opened fire in what appears to be a final crackdown to disperse them.

"This is D-Day," said one soldier when asked if this was the final push to clear the protest zone. The demonstrators have occupied much of central Bangkok since mid-April to demand the resignation of Prime Minister Abhisit Vejjajiva, dissolution of Parliament and immediate elections.

Associated Press reporters saw the troops firing automatic rifles from an overpass overlooking the encampment Wednesday morning. Minutes later a massive cloud of black smoke rose from a building nearby.

Groups of soldiers fired from crouching position on the tracks from the elevated tracks of a light rail system that runs over the encampment.

An army commander said some Red Shirt protesters were about 200 yards (meters) inside the barricade.

Soldiers extended their blockades around the protest site at dawn Wednesday and used loudspeakers to tell all people to return to their homes. Smoke billowed above the city skyline as a government building was on fire in another part of Bangkok.

At least 39 people have been killed and more than 300 people wounded in seven days of clashes in Bangkok between the protesters and troops. All but one of those killed are civilians who were shot.

Hundreds of troops and police, many armed with M-16 assault rifles, were seen in nearby streets and alleys Wednesday morning. Three armored personnel carriers were parked in front of the upscale Dusit Thani hotel, across the street from the southern edge of the barricade. Their machine gun mountain turrets pointed toward the barricade wall of tires and bamboo sticks, and troops crouched behind the vehicles.

Wednesday's troop movement came after Abhisit rejected protesters' unconditional offer to negotiate Tuesday and insisted there would be no talks until the dwindling anti-government movement abandoned its encampment in Rajprasong, a ritzy area of central Bangkok.

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Associated Press writers Denis D. Gray, Thanyarat Doksone, and Vijay Joshi contributed to this report. Additional research by Sinfah Tunsarawuth.