The Moscow theatre at the centre of a hostage-taking drama was turned into a massive bomb waiting to be detonated last night if Russian elite units attacked, according to some of the estimated 700 hostages trapped inside.
An estimated 40 Chechen militants holding the hostages for a second night fired rocket-propelled grenades and injured one of two women who managed to escape the theatre yesterday in the south-east of the city.
Another woman who tried to escape earlier was shot dead.
As the pressure increased on Mr Vladimir Putin to act to defuse the biggest crisis of his presidency, the Kremlin turned the area around the Soviet-era theatre complex into an armed camp, with crack anti-terrorist units waiting for a green light to raid the building.
Late last night columns of Russian army and interior ministry troops filed past the front of the theatre, while armoured personnel carriers lurked on the streets and the FSB security service talked ominously of "storming" the theatre, a move that could result in a bloodbath and have a critical impact on Mr Putin's presidency.
Mr Putin stressed the lives of the hostages were his priority and took personal charge of the crisis, which erupted on Wednesday night when gunmen took over the theatre.
He said the hostage-takers were acting in concert with bombers in Bali and the Philippines. "It's the same people who planned the terrorist act in Moscow," he said.
"How does he know that?" asked Ms Liliya Shevtsova, a political analyst. "That's a very inappropriate declaration." But the question many were asking was how a vanload of heavily-armed Chechens managed to move through Moscow and take over the theatre.
The first hint of a possible resolution came from Mr Sergei Mironov, the chairman of Russia's upper house of parliament, who said the Chechens could be allowed to fly to safety outside Russia if they released the hostages, who include more than 60 foreigners.
While FSB officials told the Interfax news agency that the Chechens had divided the hostages into groups by nationality and gender in the expectation "of the storm overnight", women inside the theatre reported it had been heavily mined.
"A huge amount of explosives have been laid through the place," a hostage, cardiologist Dr Maria Shkolnikova, said by mobile phone from within the theatre.
"They are saying 'You have been sitting here for 10 hours and your government has done nothing to secure your release.' The main thing is that Russian troops must be pulled out of Chechnya or they will start shooting people."
A Russian Chechen member of parliament who talked to the kidnappers yesterday reported they were giving the Russian authorities three days to meet their demands before promising "extreme measures". The Chechen news website www.kavkaz.org reported a statement by the attackers' commander, Movsar Barayev. "There's more than a thousand people here. No one will get out of here alive and they'll die with us if there's any attempt to storm the building," the website quoted him saying. He called on Mr Putin to stop the war and pull his troops out of Chechnya if he wanted to save the hostages' lives.
The rebels freed around 150 hostages on Wednesday, including up to 20 children and some Muslims, and a few more yesterday, among them three children.
But Mr Iosif Kobzon, a member of parliament who was taking part in negotiations, said: "When I asked them to free others, they said they had already let the three smallest ones go and would release no one else."
The Arab television station, al-Jazeera, screened footage said to show some of the kidnappers saying: "It makes no difference to us where we die and we chose to die here in Moscow and we will take with us the souls of the infidels."