Yemeni forces killed 17 Shia rebels and captured four in fighting last night in the north of the country, official sources said.
Security forces pushed out the militants from a number of new positions in the mountainous province of Saada, the sources said.
They denied a rebel claim that a family had been killed in the Talh region when their house was hit by rockets.
Yemeni President Ali Abdullah Saleh said yesterday the rebels, often referred to as "Houthis" after the name of their tribal leader, were receiving funding from groups in Iran as well as from Iraqi Shia cleric Moqtada al-Sadr.
Fresh fighting broke out last month between Zaydi Shia Muslims in the Saada region and government forces. The conflict first started in 2004.
The rebels, loyal to leader Abdul-Malik al-Houthi, accuse Saudi Arabia - whose Wahhabi brand of Islam regards Shias as heretics - of backing the government, while the government sees an Iranian hand behind the rebels.
Yemen, one of the poorest Arab countries, has been battling the rebellion in the north as well as a wave of al-Qaeda attacks and rising secessionist sentiment in the south.