Islamic State fighters have seized more than a third of the Syrian border town of Kobani despite US-led air strikes targeting them in and around the mainly Kurdish community, a monitoring group said on Thursday.

The commander of Kobani's heavily outgunned Kurdish defenders said Islamic State controlled a slightly smaller area. However, he acknowledged that the militants had made major gains in the culmination of a three-week battle that has also led to the worst streets clashes in years between police and Kurdish protesters across the frontier in southeast Turkey.

The Syrian Observatory for Human Rights, which monitors the country's civil war, said Islamic State - still widely known by its former acronym of ISIS - had pushed forward on Thursday.

"ISIS control more than a third of Kobani. All eastern areas, a small part of the northeast and an area in the southeast," the Observatory's head, Rami Abdulrahman, said.

Esmat al-Sheikh, head of the Kurdish militia forces in Kobani, said Islamic State fighters had seized about a quarter of the town in the east. "The clashes are ongoing - street battles," he told Reuters by telephone from the town.

An explosion was heard on Thursday on the western side of Kobani, with thick black smoke visible from the Turkish border a few kilometres (miles) away. Islamic State hoisted its black flag inside the town overnight and a stray projectile landed 3 km (2 miles) inside Turkey.

The sound of a jet flying overhead and sporadic gunfire from the besieged town was audible.

The United Nations says only a few hundred inhabitants remain in Kobani but the town's defenders say the battle will end in a massacre if Islamic State overruns the town, giving it a strategic garrison on the Turkish border.

They complain that the United States is giving only token support through the air strikes, while Turkish tanks sent to the frontier are looking on but doing nothing to defend the town.

Twenty-one people died in Istanbul, Ankara and the mainly Kurdish southeast Turkey on Wednesday in the clashes between security forces and Kurds demanding that the government do more to help Kobani.

In Washington, the Pentagon cautioned on Wednesday that there are limits to what the air strikes can do in Syria before Western-backed, moderate Syrian opposition forces are strong enough to repel Islamic State.

Islamic State has also seized large areas of territory in neighbouring Iraq, where the United States has focused its air attacks on the militants.

President Barack Obama has ruled out sending American ground forces on a combat mission, and Secretary of State John Kerry offered little hope to Kobani's defenders on Wednesday. "As horrific as it is to watch in real time what is happening in Kobani ... you have to step back and understand the strategic objective," he said.

TURKISH UNREST

In Turkey, the fallout from the war in Syria and Iraq has threatened to unravel the NATO member's delicate peace process with its own Kurdish community.

Following Wednesday's violence in Turkey, streets have been calmer since curfews were imposed in five southeastern provinces, restrictions unseen since the 1990s when Kurdish PKK forces were fighting the Turkish military in the southeast.

Ankara has long been suspicious of any Kurdish assertiveness which puts itself in a tough position as it tries to end its own 30-year war with the outlawed PKK (Kurdistan Workers Party).

Kurdish leaders in Syria have asked Ankara to help establish a corridor which will allow aid and possibly arms and fighters to cross the border and reach Kobani, but Ankara has so far been reluctant to respond positively.

Saleh Muslim, co-chairman of the Kurdish Democratic Union Party (PYD) in Syria, met Turkish officials last week, Kurdish sources said, but the meeting was not fruitful.

The PYD annoyed Turkey last year by setting up an interim administration in northeast Syria after Syrian President Bashar al-Assad lost control of the region. Ankara wants Kurdish leaders to abandon their self-declared autonomy.

PYD's co-chairwoman Asya Abdullah told Reuters earlier this week that this demand was not acceptable to Kurds. "We told Turkey that it is not possible for us to take a step back," she said by telephone from Kobani.

President Tayyip Erdogan says he also wants the US-led alliance to enforce a "no-fly zone" to prevent Assad's air force flying over Syrian territory near the Turkish border and create a safe area for an estimated 1.5 million Syrian refugees in Turkey to return.

Turkey has also been unhappy with the Kurds' reluctance to join the wider opposition to Assad.

On the Turkish side of the frontier near Kobani, 21-year-old student Ferdi from the eastern Turkish province of Tunceli said if Kobani fell, the conflict would spread to Turkey.

"In fact it already has spread here," he said, standing with a group of several dozen people in fields watching the smoke rising from west Kobani.

Turkish police fired tear gas against protesters in the town of Suruç near the border overnight. A petrol bomb set fire to a house and the shutters on most shops in the town were kept shut in a traditional form of protest against state authorities.

Kurdish anger over Kobani has also revived long-standing grudges between the PKK sympathisers and Turkish Islamist groups that are linked to the Hezbollah movement in Lebanon and which now appear to be siding with Islamic State.

In Diyarbakir, Turkey's biggest Kurdish city, five people were killed in clashes on Monday and Tuesday between Islamist groups and PKK supporters, a senior police officer said. – Reuters