Turkish news reports say Turkish jets are bombing suspected outlawed Kurdistan Workers' Party (PKK) bases in neighboring northern Iraq.
NTV news channel says some 15 warplanes took off from a Turkish base to strike at bases from where PKK launch attacks on Turkish targets. CNN-Turk television says Turkish F-16s were involved in the raids.
The planes took off from a base in the southeastern city of Diyarbakır and struck targets in the mountainous Kandil and Zap areas of Iraq where the PKK operates a number of bases, the sources said.
They said the targets included anti-aircraft defences and PKK shelters in the region.
The air raids came hours after reports of an attack by PKK members on a military convoy in southeastern Turkey.
Eleven soldiers and a member of the state-backed village guard militia were killed in the ambush in Hakkari province's Çukurca district near the Iraqi border, Turkish media reported.
The PKK did not immediately claim responsibility.
Prime Minister Recep Tayyip Erdoğan condemned the killings, saying those who carried out such attacks would "pay the price".
"Our patience has finally run out. Those who do not distance themselves from terrorism will pay the price," Erdoğan told reporters on the sidelines of a conference in İstanbul.
Commenting on the killing of soldiers on Wednesday and recent remarks by Erdoğan, who said the country is set to adopt new tactics in its fight against the PKK after Ramadan, President Abdullah Gül said Turkey is not waiting for the end of Ramadan when it comes to counterterrorism measures.
It is out of question that authorities wait for the end of Ramadan in the fight against terror. Counterterrorism efforts are under way in all dimensions. There is no weakness in the face of terrorism. Everyone should know that there is no power above the power of the state. Whoever thinks that he can bring Turkey into line with terror, violence and weapons is greatly misled. The cost of this will also be very heavy, he said.
Recent Turkish media reports have said Erdoğan plans to launch a new offensive against the PKK in southeastern Turkey after the end of the Muslim fasting month of Ramadan.
In July, PKK members killed 13 troops, the highest death toll for Turkish troops in an attack since the PKK ended a ceasefire in February. More than 40,000 people have been killed in the conflict since the PKK took up arms for Kurdish self-rule in 1984.
The Fırat news agency, which is close to the PKK, said the Turkish jets were also targeting Qandil, a mountain near the border with Iran, where PKK leaders are believed to be hiding.
The Turkish reports were based on unidentified sources and there was no immediate official confirmation of the strikes.
If confirmed, the raids would be Turkey's first cross border offensive since last summer, when Turkish warplanes carried out a series of retaliatory air raids on suspected PKK hideouts across the border.
Defense Minister İsmet Yılmaz vowed tough response immediately after the attack, as the military launched an air and ground offensive in the largely Kurdish Hakkari province where the attack happened, Turkey's state television reported.
"The retaliation they will find will be manifold stronger," Yılmaz said.
Turkey has frequently launched air strikes or sent soldiers across the border to fight the PKK members.
Asked Wednesday about the possibility of a cross-border offensive, Erdoğan replied: "These things are not talked about they are done."
In Washington, US State Department spokeswoman Victoria Nuland said the United States stands with Turkey in its fight against the PKK.
"We support Turkey in its fight against terror, and we will continue to work with the government of Turkey to combat terrorism in all forms," Nuland said.
Dozdar Hamo, a PKK spokesman told Reuters in Iraq: "The border area has been bombed since 9 pm (1800 GMT) by Turkish planes, and the bombing is very intense. Nearby there are three Kurdish villages. We have no casualties on our side. We don't know if there are any casualties among villagers."
"Different areas along the border have been bombed by Turkish aircraft on the pretext that there are camps from the PKK," said Ahmed Qadir, a local government representative in the hamlet of Sedaka, near the Turkish-Iranian border in Iraq's semi-autonomous Kurdish region.
"These places have no population because most people left a month ago after they were bombarded by Iranian artillery. Even shepherds have stopped going to these places," he said.
Turkey and Iran have often skirmished with PKK and PJAK members in that region. Last month Iranian shelling of the area forced hundreds to flee their homes during clashes with the PJAK, an Iranian offshoot of the PKK.
The air raid was carried out on the eve of a meeting of the National Security Council (MGK), which meets once every two months and which was expected to discuss the recent upsurge in separatist violence.
It also followed a period of upheaval in the armed forces, with four new top commanders appointed to replace those who resigned in protest at the jailing of hundreds of their colleagues in connection with anti-government conspiracies.
Last month, the PKK's jailed leader Abdullah Öcalan sent word through his lawyers that he had agreed with Turkish officials to set up a "peace council" aimed at ending the conflict.
Öcalan said the council should be formed within one month, although it was unclear what form it would take.
The proposal came a month after Erdoğan's Justice and Development Party (AK Party) won an election for a third term in power and two months after Öcalan threatened war unless the government entered talks.
But on Wednesday Erdoğan said the government was "finished with talking".
"From now on there is nothing to talk about. We will see what happens," he told reporters.
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Today's Zaman, your gateway to Turkish daily news