Ethiopian forces and Tigrayan rebels are battling fiercely for the control of Kombolcha after rebels claimed they captured the town.
Rebellious Tigrayan forces have killed 100 youths in Kombolcha, one of two towns the rebel group said it captured over the weekend.
"The terrorist group TPLF has summarily executed more than 100 youth residents of Kombolcha in areas it has infiltrated," the Government Communication Service said on Twitter on Monday.
"The international community should not turn a blind eye to such atrocities," the statement added.
Reports of rebels capturing Kombolcha came a day after they claimed control of Dessie and if confirmed, it would mark a major advance by the Tigray People's Liberation Front (TPLF) in the nearly year-long war.
Much of northern Ethiopia is under a communications blackout and access for journalists is restricted, making battlefield claims difficult to independently verify.
Kombolcha residents described non-stop gunfire overnight and into the early hours on Monday, with some saying they heard what appeared to be an air strike on the town's outskirts around midnight.
A government spokesperson, however, said on Monday that there were no air strikes in Kombolcha overnight.
The rebels' offensive in the towns south of Addis Ababa has fuelled speculation that the TPLF was approaching Ethiopia's capital.
Control of the skies, along with superior manpower, is one of the few remaining areas where the government holds a military advantage over the rebels.
The conflict erupted last November when Prime Minister Abiy Ahmed deployed troops in Tigray, promising a swift victory.
But the operation instead spiralled into a prolonged war marked by massacres, mass rapes and a humanitarian crisis.