A new wave of violence in the troubled province of Kosovo could be more explosive than ever, with both Serbs and ethnic Albanians increasingly bitter. Full-scale diplomatic peace efforts in recent months have made little progress, putting unarmed international monitors precariously in the middle. For the moment, observers say, the international community has been relegated to the role of bystander. An October deal between US envoy Richard Holbrooke and Yugoslav President Slobodan Milosevic staved off NATO airstrikes against the Serbs, who had cracked down on the ethnic Albanian resistance movement in Kosovo. The agreement was supposed to bring peace on the ground and allow diplomats enough breathing room to negotiate a political settlement. But, despite the onset of winter, the two sides have skirmished, with several people being killed each week. Close to the same level of tension pervades the region as before the agreement. Recent turbulence In the past week, some 2,000 people have been driven from their homes, and two villages were destroyed, says Fernando Del Mundo, the spokesman for the Kosovo outpost of the United Nations refugee agency. One southern village, Slapuzane, was vacated over the weekend by ethnic Albanians fearing retribution after three Serbian policemen were killed nearby. Another village, Perane, was shelled by the Serbian police Jan. 9, killing one teenage ethnic Albanian and injuring another. According to Mr. Del Mundo, some 180,000 Kosovars, mostly Albanians, remain displaced from their homes, though most have found temporary shelter. Since fighting broke out nearly a year ago, more than 1,000 people have been killed in Kosovo. Most of the victims have been ethnic Albanians. Kosovo is the southern region of Serbia, which along with Montenegro makes up Yugoslavia. Although the region has a 90 percent ethnic Albanian majority, it has been under tight control of the Serbian police for the past decade, since Slobodan Milosevic rose to power and stripped the Albanians of their autonomy. While mainstream ethnic Albanian leaders like Ibrahim Rugova preached independence through passive resistance, the ethnic Albanian independence fighters known as the Kosovo Liberation Army (KLA) slowly grew in the rural villages. Last year their ranks swelled and they began to take on the more heavily armed Serbs head to head. After initial setbacks, the KLA has now regrouped, and its resolve seems to have solidified. It is reportedly awash in new equipment, and its fighters, once bordering on hapless, are now experienced in guerrilla warfare. International efforts The international community has been pursuing a two-track course to bring peace to Kosovo. On one hand, the Organization for Security and Cooperation in Europe (OSCE) has some 700 unarmed monitors to verify what remains of the October cease-fire agreement. The OSCE mission could eventually swell to 2,000 verifiers. OSCE head Knut Vollebaek, of Norway, arrived Jan. 12 in Pristina, the capital of Kosovo. Simultaneously, the US is spearheading an effort to find a lasting political settlement to Kosovo. After a month-long reprieve, US diplomat Christopher Hill was in the region this week, resuming shuttle diplomacy between the Serbs, who insist that Kosovo remain an integral part of Serbia, and the Albanians, who advocate nothing less than complete independence. The international community favors something in the middle - possibly a restoration of ethnic Albanian autonomy while keeping Kosovo in Serbia. NATO, meanwhile, has said it is still possible that it might launch airstrikes against military and police positions throughout Yugoslavia, although it appears unlikely at this time. Captive Yugoslav soldiers Recent events on the ground include a tense situation that began on Jan. 8, when eight Yugoslav Army soldiers were seized in northern Kosovo. The KLA held them captive near the city of Mitrovica. The Yugoslavs threatened to retaliate, while the OSCE tried to negotiate a settlement. At press time, the OSCE's Mr. Vollebaek reported a deal was in the works to release all eight soldiers. On Jan. 11, a leading ethnic Albanian figure was assassinated in front of his apartment in Pristina - just the latest violent incident in Kosovo's capital, which so far has been spared any heavy fighting. It is unknown whether the man, Enver Majoku, was killed by Serbs or Albanians, though speculation runs high on both sides. Mr. Majoku was a close associate of Mr. Rugova, whose policy of passive resistance has come under fire from more radical ethnic Albanians like the KLA. Majoku was the head of Rugova's information service. And last week, Serbian civilians in Kosovo, many of whom are armed, responded to KLA attacks on Serbs by temporarily barricading the roads leading to Pristina. They called on Milosevic to strengthen his position in Kosovo and provide them with more protection. According to a Western diplomat familiar with negotiations, the lack of progress is partially due to the unwillingness of both sides to compromise, and partially due to the tension on the ground. "Obviously events on the ground make negotiations tough," says the diplomat. "This is not easy."