At least five people died on Tuesday, according to a resident who requested anonymity for safety reasons, and the city remained under siege amid a military offensive against protesters.
The humanitarian situation deteriorated amid the government's offensive in the city. Shops and bakeries were closed, and at least two mosques were damaged. The gunfire could be heard "all night and morning," the witness said.
"This is the fourth day that we do not have electricity or water. Landline phone connections have been down most of the day," he said by satellite phone.
Snipers perched atop various locations in the city's al-Ramel neighborhood, the site of a Palestinian refugee camp, he said.
Demonstrations have taken place in the Ramel area every day since the Syrian uprising began five months ago, the Local Coordination Committees of Syria said.
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"The tragedy of (Ramel) has not stopped since yesterday," the LCC said in a statement Tuesday.
The refugee camp normally holds 10,000 people, but reports have surfaced of many people fleeing violence there.
The resident said a large portion of the Ramel area has been evacuated.
The U.N. Relief and Works Agency, which provides assistance for Palestinian refugees across the Middle East, has expressed alarm over reports of heavy gunfire from Syrian security forces into the refugee camp and other areas.
"Reports from various sources indicate deaths and casualties among the Palestinian refugee population, although poor communications make it impossible to confirm the exact number of dead and injured," it said in its latest statement.
Christopher Gunness, UNRWA spokesman, said refugees in Latakia had been asked to leave by the Syrian security forces. He said some left on their own because they were afraid for their lives.
"We are asking the Syrian government for immediate access to the Palestinians, as their well-being is our responsibility," Gunness told CNN.
The state-run Syrian Arab News Agency said security forces entered the city only to protect its residents from armed gangs.
The Syrian government vehemently denied reports that more than 5,000 Palestinians fled the refugee camp in the area after it came under fire from Syrian security forces. It also reported Tuesday that reports of shelling by the navy on Ramel are "completely untrue."
A video posted on YouTube Monday purportedly shows a dead girl who was shot in the eye as her father drove by a security checkpoint in Latakia.
Rami Abdul-Rahman of the Syrian Observatory for Human Rights, an activist group, said the girl and her parents were trying to flee in a car. The father was shot in the shoulder and the mother was lightly injured.
Bloodshed in the country has persisted since a government crackdown on anti-government protesters started in mid-March.
The LCC said at least 2,545 people have died. The vast majority were civilians, and 391 were security personnel, the LCC said.
The strong security reaction to demonstrators calling for political changes has spurred outrage among world powers, like the United States, and among Syria's neighbors, such as Jordan and Turkey.
CNN cannot independently verify opposition or government claims because Syria has restricted international journalists from reporting inside the country.