* Gunfight in Tunisian town near border
* Gaddafi unit entered town of Dehiba in pursuit of rebels
* Rebels say have re-taken border crossing
By Zoubeir Souissi
DEHIBA, Tunisia, April 29 (Reuters) - Forces loyal to Libyan leader Muammar Gaddafi crossed into neighbouring Tunisia and fought a gun battle with Tunisian troops in a frontier town on Friday as Libya's conflict spilled beyond its borders.
Pro-Gaddafi forces fired shells into the town of Dehiba, damaging buildings and injuring at least one resident, and a group of them drove into the town in a truck, local people and a Reuters photographer in the town said.
The Libyan government troops were pursuing anti-Gaddafi rebels from the restive Western Mountains region of Libya who fled into Tunisia in the past few days after Gaddafi forces overran the border post the rebels had earlier seized.
"There were lots of clashes in the town this morning. Lots of gunshots. The Tunisian military clashed with Gaddafi's forces ... Some of Gaddafi's people were killed," said Reuters photographer Zoubeir Souissi from the town.
"There are a lot of Gaddafi's people who were injured. They are in the hospital in Dehiba," he said.
Two residents also told Reuters that shells had fallen on the town from pro-Gaddafi positions across the border in Libya.
"Rounds from the bombardment are falling on houses.... A Tunisian woman was injured," one of the residents, called Ali, told Reuters by telephone.
He said later the fighting and shelling had stopped. "The Tunisian army is combing the town. We have no idea about the fate of Gaddafi's forces there because the Tunisian army closed the gates to the town and nobody is allowed to enter."
A Libyan rebel said anti-Gaddafi fighters had retaken control of the border crossing near Dehiba. The main crossing into Libya, two hours' drive to the north, remains firmly under Libyan government control.
"Right here at this point I'm looking at the new (rebel) flag flying up there at the border. The rebels have got control of it, the freedom fighters. We're just in the process of opening it up," rebel Akram el Muradi said by telephone.
Tunisia's government late on Thursday issued a statement condemning incursions by Libyan forces after shells fired by Gaddafi loyalists fell into the desert near the border.
"Given the gravity of what has happened... the Tunisian authorities have informed the Libyans of their extreme indignation and demand measures to put an immediate stop to these violations," a statement from the foreign ministry said.
Friday's clashes marked the first time that Libyan government ground forces had crossed the border and entered a Tunisian town.
Residents said that a crowd of local people gathered in Dehiba on Friday morning to try to prevent pro-Gaddafi forces from entering the town.
They said the Tunisian military fired in the air to disperse them, and urged the demonstrators to seek shelter from the shelling inside their homes.
Tunisia toppled its own veteran leader, Zine al-Abidine Ben Ali, in a revolution earlier this year and many people there are sympathetic to the rebels fighting Gaddafi's forces. (Additional reporting by Tarek Amara and Matthew Tostevin in Tunis and Hamid Ould Ahmed in Algiers; Writing by Christian Lowe; Editing by Matthew Tostevin)