BAJRAM CURRI, Albania (AP) _ Igniting fears of a widening conflict, Serb forces pushed into northern Albania on Tuesday, fought an hour-long skirmish with Albanian troops, seized a border hamlet and torched homes before withdrawing, Albanian officials and international observers said.

With Albania a major staging ground for NATO forces, even Tuesday's incident _ short-lived, small-scale, with no reported casualties _ brought a warning from Washington that Yugoslavia would make a grave mistake in expanding the fighting.

In Belgrade, Yugoslav officials denied any incursion into Albania. The chief of the army information service, Col. Milivoje Novkovic, said on state television that Yugoslavia's defense of its own borders was ``being fabricated as an alleged invasion.''

Albania, in turn, said the Serb push into its territory would carry consequences. Sokol Gjoka, an Albanian Foreign Ministry official, said his country would take necessary steps to defend itself, ``in close coordination with our allies.''

These days, that means NATO, which has taken over Albania's airfields, airspace and military infrastructure. In coming weeks, a force of Apache attack helicopters and thousands more allied troops will be based in Albania.

White House spokesman Joe Lockhart said Washington had received ``credible reports'' of a Serb incursion, as well as past instances of Serb forces crossing the border or shelling Albanian territory.

``If (Yugoslav) President (Slobodan) Milosevic seeks to widen this war, it will be a great mistake,'' he said.

The warning came as NATO moved to more than double its air armada. In Brussels, Belgium, the supreme allied commander in Europe, U.S. Army Gen. Wesley Clark, said he had requested 300 more U.S. aircraft as well as additional air power from other NATO allies.

In Washington, President Clinton said nearly three weeks of NATO airstrikes are ``diminishing and grinding down'' Milosevic's military capabilities.

Air raid sirens wailed in several cities across Serbia late Tuesday, those in Belgrade sounded around nightfall and shortly before midnight.

NATO targeted a railroad bridge and the Bistrica hydroelectric power plant in southwestern Serbia early Wednesday, cutting power lines connecting it with the surrounding area, local media said. Several other cities in the region were also targeted, but there were no immediate reports of damage.

The Albania border clash, by the account of international monitors watching from nearby, began when about 50 Serb infantrymen advanced on lightly manned Albanian border posts early Tuesday afternoon.

The frontier has long been an active arena for the rebel Kosovo Liberation Army in its battle against Yugoslav forces.

Listening in on the Albanian border police radio frequency, international monitors say they heard police urgently ask Albanian soldiers stationed a few miles away what to do. They were told to stand and fight, but soon reported they were surrounded and retreating.

As the Yugoslav forces pushed toward the hamlet of Kamenica (pronounced Kah-mah-NEE-tsah) _ which had already been shelled by the Serbs for several days, driving off most residents _ Albanian soldiers moved to engage them.

After an exchange of fire _ possibly light artillery, according to the monitors _ the Serbs pulled back, but not before torching several houses.

Artan Jakupi, a translator with the Organization for Security and Cooperation in Europe, which monitors the border area, watched from the village of Bajram Curri, seven miles away, as a cluster of houses burned in Kamenica, including his own.

In the three weeks since NATO began airstrikes aimed at forcing Milosevic to pull his forces out of Kosovo, agree to a peace deal and end the mass expulsions of ethnic Albanians, Yugoslavia has scorned any compromise.

On Tuesday, however, deputy Prime Minister Vuk Draskovic hinted Yugoslavia might find ``certain preconditions for agreement,'' claiming the alliance had ``abandoned key goals regarding Kosovo,'' including a NATO-led force in the province and ``independent-like'' status for the Kosovo Albanians.

NATO, meanwhile, said its bombardment of a passenger train in southern Serbia on Monday was ``an uncanny accident.'' The alliance said the target was the bridge the train was crossing.

Yugoslav officials said 10 people died and 16 were hurt when the train was struck by NATO missiles, turning it into a heap of twisted, charred metal.

Clark called it ``one of those regrettable things that happen in a campaign like this'' and said the pilot saw movement _ the train _ too late to abort the strike.

The refugees drama also continued Tuesday, as more ethnic Albanians reported systematic Serb atrocities. Before dawn, 4,800 more refugees entered Albania and hundreds more crossed into Macedonia. They said Serbs had methodically emptied their villages near Pristina, Kosovo's capital, and taken up positions in newly vacated areas.

More than a half-million ethnic Albanians have fled or been driven out of Kosovo since NATO began its assault March 24. Refugees consistently report being terrorized by Serb forces, their homes set ablaze, possessions taken, and identity papers confiscated.

In Yugoslavia, a night of airstrikes continued into the daylight hours Tuesday. Four big detonations were heard at midmorning in Pristina, with a military barracks the apparent target.

Fuel facilities were particularly targeted. Using airstrikes, the allies hope to reduce the movement of Yugoslav troops, particularly in and out of Kosovo by cutting off military fuel supplies.

In strikes late Monday and early Tuesday:

_Yugoslavia's biggest oil refinery, at Pancevo just across the Danube River from Belgrade, was hit late Monday and again early Tuesday.

_Six NATO missiles hit an oil depot and plastics factory Tuesday near Pristina, setting a fuel reservoir ablaze, the state news agency Tanjug said.

_Fire lit the night sky in Smederevo, central Serbia, late Monday and early Tuesday after NATO missiles targeted an industrial zone housing installations of the state fuel giant Jugopetrol, according to Tanjug.

_Northern targets included an oil depot outside Sombor, and another major refinery at Novi Sad, local media reported.