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Iran's defeated presidential candidate Mirhossein Mousavi said on Sunday urged Iranians to continue exercising their "right" to protest election rigging, in a direct challenge to the leadership of the Islamic Republic.

Helicopters buzzed through the evening sky over Tehran and gunfire was heard in northern Tehran, a bastion of support for the reformist former prime minister.

Mousavi's call came after at least 17 people were killed in the week-long clashes between police and demonstrators in Tehran.

"Protesting against lies and fraud [in the election] is your [Iranians] right. Today the country mourns for ... those killed in the protests. I call on you to remain calm," Mousavi said in a statement, published on his Web site.

He called on his supporters to keep up their protests but to show restraint, his Web site reported. "In your protests continue to show restraint. I am expecting armed forces to avoid irreversible damage," Mousavi said in a statement.

Gunfire rang out in Tehran late on Sunday after at least 10 people were killed in renewed clashes over the weekend, and after more than a week of unprecedented popular defiance against the leadership of the Islamic Republic.

"I heard repeated shootings while people were chanting Allahu Akbar (God is greatest) in Niavaran area," said a witness, who asked not to be named.

Iranian state television also reported Sunday that authorities had arrested the daughter of former president Hashemi Rafsanjani along with four other family members late Saturday for taking part in unauthorized protest rallies. The report did not identify the four other family members or give more details.

Iran tate TV showed pictures of Faezeh Hashemi, Rafsanjani's eldest daughter, speaking to hundreds of opposition supporters last week.

Rafsanjani has made no secret of his distaste for President Mahmoud Ahmadinejad, whose re-election victory in a June 12 vote was disputed by Mousavi. Ahmadinejad has accused Rafsanjani and his family of corruption.

Shortly after news of the arrests emerged, Iran's moderate former president Mohammad Khatami called for the immediate release of protesters arrested in the country since June 13, the semi-official Mehr news agency reported.

"The immediate release of those arrested during protests can calm the situation in the country," Khatami said in a statement, Mehr reported.

'Death to the dictator!'

Iran's English-language Press TV said Sunday that "rioters" had set two gas stations on fire and attacked a military post.

CNN quoted earlier Sunday a Tehran hospital source as saying at least 19 people were killed in Iran on the previous day alone.

The U.S. news network also cited unconfirmed reports as putting the death toll at 150 on the seventh day of post-election protests, which were held in defiance of the Islamic Republic's highest authority. The official number, however, stands at 17.

Iranian state television said Sunday "a few" people were killed inside a Tehran mosque set on fire during street protests the evening before.

Witnesses claimed that numerous demonstrators were also wounded in clashes with black-clad police wielding guns, truncheons, tear gas and water cannons on Saturday as protests over disputed elections escalated into Iran's most serious internal unrest since the 1979 Islamic Revolution.

Authorities did not confirm any deaths, and reports from bloggers andTwitter users inside Iran could not immediately be verified.

On Sunday, Iran braced for the possibility of more bloody confrontations between protesters and security forces on the streets of Tehran as fresh images of brutality emerged, despite the regime's attempts to impose a news blackout.

If proven true, the reports could enrage conservatives and bring strains among backers of Mousavi, whose protest movement claims widespread fraud in the election robbed him of victory and kept Ahmadinejad in office.

Thousands of protesters defied Iran's supreme leader, Ayatollah Ali Khamenei, to march on waiting security forces. Amateur video showed the demonstrators pelting police with stones and shouting: "Death to the dictator!"

Scores of wounded protesters who had sought medical treatment were arrested by security forces at hospitals in the capital, the International Campaign for Human Rights in Iran claimed.

It said doctors had been ordered to report protest-related injuries to theauthorities, and that some seriously injured protesters had sought refuge at foreign embassies in a bid to evade arrest.

Footage shows Iran woman after fatal shooting

Amateur video showed clashes erupting Saturday in the southern city of Shiraz and witnesses reported street violence in Isfahan, south of Tehran.

Other footage posted in the hours after the crackdown showed blood pouring from a young woman's nose and mouth as frantic people tried to help her.

Two separate videos of the incident, each shot from a different angle, were uploaded onto the social networking sites Facebook and YouTube. The YouTube video described the location of the incident as Amirabad, central Tehran, and said the woman had been fatally shot.

The Associated Press could not independently verify the content of the video, its location, or the date it was shot.

Please note that this video contains scenes of graphic violence

Iran media: police chief warns Mousavi over unrest

Iranian newspapers reported on Sunday that Iran's police chief has warned Mousavi that officers will "decisively confront" any further unrest.

A letter to Mousavi from police chief Ismail Ahmadi Moghaddam was carried by newspapers after Saturday's clashes across Tehran. It was not clear when the letter was written.

"I announce that if the current situation continues the police, in line with preserving the society's and people's order and security, will decisively confront illegal activities," Ahmadi Moghaddam said, according to the Etemad-e Melli daily.

"After the announcement of the election results your supporters, in an illegal act, poured into the streets and by disrupting public order and security disrupted society's atmosphere," the letter said.

Iran's state television, meanwhile, reported Sunday that the Islamic Republic has arrested members of an exiled opposition group it accused of "terrorist activities" including setting buses on fire and destroying public property.

The report, which did not directly mention the election or the unrest, said the arrested members of the Mujahideen Khalq Organization had entered Iran after receiving training in neighboring Iraq. It said they were guided by the group's "operation room" in Britain.

"Leaders of this group had encouraged members to carry out terrorist activities such as setting buses and gas stations on fire and attacking Basijis [Islamic militiamen] and destroying public property," state television said.

It did not say how many people were arrested or when.