South Ossetia has accused Georgian forces of firing at it while Russia has warned Tbilisi it's ready to use force to defend civilians. The renewed tensions come just one week ahead of the first anniversary of the war.
Russia recognizes South Ossetia as independent and has thousands of troops stationed there
Georgia on Saturday denied firing mortars at the breakaway republic of South Ossetia.
South Ossetia claimed two mortar rounds were fired at a military observation post from the village of Ditsi on the Georgian side of the de facto border.
Also on Saturday, Moscow warned Georgia that its military reserved the right to use force if necessary if the former Soviet state continues "provocations" in the Caucasas.
Georgia, Russia trade accusations
Both sides have accused the other of shelling earlier this week in Tskhinvali, the capital of the South Ossetian breakaway region, which is recognized as independent by Russia.
Georgian Interior Ministry spokesman Shota Utiashvili, speaking to AFP in Tbilisi, denied any shooting had taken place. But the Russian defense ministry described the alleged Georgian actions as an "attempt by the Georgian leadership to inflame the situation in the region."
Utiashvili described the statement as "very worrisome", saying Russia "may be searching for a pretext" for military action against Georgia.
"We hope the international community will condemn these clearly aggressive actions from the Russians," he said.
The latest tensions between Georgia and Russia come a week ahead of the August 7 anniversary of the five-day war between the two countries over South Ossetia.
A Georgian military attempt to retake South Ossetia was rebuffed by Russia. Moscow then sent troops and tanks deep into Georgian territory.
Rebel leader calls for unification with Russia
South Ossetian President Eduard Kokoity would like the region to become part of Russia
In an interview with the Reuters news agency the leader of the rebel enclave of South Ossetia said he wanted to unite his people with Russia and called on the Kremlin to deploy more troops and weapons.
"My goal in life, my political goal, is to unite my people," the self-styled president, Eduard Kokoity, said during the interview.
"We will build our own state, which will be in alliance with Russia, together with Russia and I am not excluding that one day, we will be part of Russia," he said. "The people of South Ossetia want to be united with Russia."
South Ossetians, who are ethnically distinct from Georgians, speak their own Farsi-related language and say they have been separated from their fellow people in the neighboring region of North Ossetia in Russia.
Ninety eight percent of South Ossetia's population hold Russian passports. Russian is the lingua franca and the Russian ruble is the currency used.
Kokoity said Russia was not yet ready for unification "because this involves a very serious accusation of annexing territory."
"If Ossetia is united, then I shall leave the political arena for good."
Editor: Sonia Phalnikar