One of Africa's most bitter wars - which has been largely dormant since 2000 - risks reigniting, partly because America's neutrality in the conflict may be compromised by the alliance it formed with Ethiopia in the war on terrorists.
Border tensions between landlocked Ethiopia and tiny coastal autocracy Eritrea have surged since Oct. 5, when Eritrea banned United Nations helicopters from flying in key parts of its airspace. UN Secretary General Kofi Annan responded this week by hinting the UN might pull out its peacekeepers now patrolling the disputed border between the two nations.
The UN Mission in Ethiopia and Eritrea (UNMEE) has already announced that it is pulling troops from 18 of 40 border posts and warns that it is now unable to properly monitor the border. If the UN does pull out completely, the war could restart.
Ethiopian Prime Minister Meles Zenawi complained Wednesday that Eritrean troops were sneaking into a demilitarized border zone disguised as militia soldiers. He urged the UN to respond.
What's at stake is a repeat of a 1998-2000 conflict that left 70,000 people dead - and fresh fighting in a region with some of the world's least-stable states, including Somalia, long considered a potential terrorist incubator.
The overall dispute partly has to do with port access. When Eritrea gained its independence from Ethiopia in 1991 - after a 30-year war - Ethiopia became a landlocked country. Despite the past few years of tense calm, there remain many unresolved issues revolving around where exactly the border should be.
In 2002, both sides agreed to abide by the terms of a UN-backed Boundary Commission's ruling that awarded to Eritrea, among other areas, a fiercely disputed town called Badme. Yet, Ethiopia did not abide by the ruling and still claims the town as its own.
Certainly the conflict has its own local roots - and perhaps solutions. But the US, experts say, could strong-arm Ethiopia into making key concessions - except that it counts on Ethiopia for help in the war on terror and therefore doesn't want to antagonize it.
"Ethiopia is a major player in terms of American counter-terror strategy," says Richard Cornwell at the Institute for Security Studies in Pretoria, South Africa. Therefore, he says, the US is reluctant to push Ethiopia too hard.
Ethiopia's value to the US stems in part from the region's geography. The nation shares a long stretch of border with Somalia, a lawless country where Al Qaeda and other Islamic militant groups have been known to operate. In fact, according to the International Crisis Group, Ethiopian security forces operate in Somalia, including in the major city of Mogadishu. US officials have warned in recent months that if Al Qaeda operatives ever leave Iraq, they may head for Somalia.
Eritrea, meanwhile, is a notoriously closed and controlled society. It's a country with 4.5 million people and located on the Red Sea. Western journalists are rarely allowed in. And it's hard to judge what the latest moves mean.
In general, observers say, there's growing distrust of the outside world among Eritrea's small ruling cadre. That's partly because the world community - including the US - hasn't pushed Ethiopia to acknowledge the UN-backed court's 2002 ruling, say experts.
Indeed, another reason for US and western reluctance to arm-twist Ethiopia is apparent concern that Ethiopia's ruling party isn't strong enough to withstand the storm of domestic criticism that would ensue if it gave up Badme and other disputed areas. There's worry the already fragile country could well fall apart.
Eritrea's new banning of UN helicopter flights over the border zone may simply be an effort to get more attention from the international community - in hopes of building diplomatic pressure on Ethiopia. But there are other possible motivations.
There's a major fuel shortage in Asmara, the capital of Eritrea, Mr. Cornwell points out. This may point to how bad the economy has gotten - and that President Isaias Afwerki is stoking tensions with Ethiopia to prevent internal economic dissent from building. Or the military could be stockpiling fuel for a major offensive against Ethiopia.
UN officials say they haven't seen any major military changes on the ground, although the new helicopter restrictions prevent the monitoring of roughly 55 percent of the border region.
• Wire services were used in this report.