Aden, Yemeni separatists have taken almost full control of the southern port city of Aden after days of fighting with government forces, residents say.
PM Ahmed bin Daghar and members of his cabinet are believed to be holed up inside the presidential palace in Aden.
There are reports of talks between the southern separatists and government forces, who were previously allies.
The fighting opens up a new front in Yemen, splitting the alliance against Houthi rebels in the north.
It has already led to the deaths of 40 people since Sunday, the Red Cross says.