Egypt has been hit by another wave of major violence ahead of parliamentary elections after security forces opened fire on thousands of protesters demonstrating against the military junta.

Two people were reported dead and more than 600 injured in central Cairo after riot police sent volleys of tear gas, rubber bullets and "birdshot" pellet cartridges into the crowds. The clashes put further pressure on the ruling generals and cast doubt on the ability of police to secure the poll, scheduled to begin on 28 November.

"All options are on the table, but right now – given the state Egypt is in – nobody can see how the military council can pull off these elections," said Mahmoud Salem, a prominent blogger who is running for parliament but who has now frozen his campaign. "I'm at the international eye hospital at the moment with my friend Malek Mustafa, who has been shot in the head by police with a pellet cartridge and looks likely to lose his eye. How can I continue?"

Mustafa was one of dozens of demonstrators left with serious head wounds during the police assault on Tahrir Square. Trouble began after riot police moved to disperse tents set up after a large rally calling on Egypt's Supreme Council of Armed Forces (Scaf) to return the country to civilian rule.

Protesters succeeded in driving the security forces from the square and captured one of their trucks. Crowds jumped up and down on the vehicle, chanting "The interior ministry are thugs" and calling for the downfall of Field Marshal Mohamed Hussein Tantawi, the country's de facto leader since the toppling of Hosni Mubarak in February. It was later set ablaze.

By mid-afternoon police had returned to Tahrir in far larger numbers and began firing from armoured vehicles. Pro-change activists sent out calls for solidarity and as darkness fell police and the protesters saw their ranks swell. As the night wore on and control of Tahrir shifted back and forth between the security forces and demonstrators, running battles spilled down side streets and along several of downtown Cairo's most important thoroughfares.

The Observer saw heavy fighting along Talaat Harb street, a key shopping district and one of the main roads running into Tahrir Square. Street lighting was cut and amid the gloom hundreds of protesters tore up paving stones to throw at police lines, sporadically falling back as clouds of tear gas filled the air.

"The scenes are reminiscent of the Friday of Anger," said journalist and pro-change activist Hossam el-Hamalawy, referring to 28 January, the day protesters beat Mubarak's security forces off the streets during the uprising against his regime. "We are being hit with showers of US-made tear gas canisters, and I've watched with my own eyes at least five people being struck by rubber bullets."

A military police car which at one point approached the centre of the unrest was chased away by protesters, another sign of public support for the junta apparently waning. "Ordinary people are making a stronger link than ever between Scaf and the hated troops of the interior ministry," added el-Hamalawy. "The police and Scaf are revealing their true colours with this brutal attack on Egyptians. They have succeeded in only one thing today, and that is mobilising even more of Egyptian society against them."

By late evening the number of demonstrators had grown to several thousand with the arrival of the ultras – hardcore fans of Cairo's main football teams, some of whom played a significant role in the anti-regime uprising earlier this year – and some Islamist political groups, forcing police units to fall back from Tahrir where protesters quickly built barricades and fires continued to burn.

The retreat marked a significant blow to the security forces, which over the past few months have generally avoided attacking large protests, preferring to wait instead until numbers dwindle and the remaining activists can be isolated and labelled as hardcore troublemakers. On Saturday that tactic appeared to have backfired, with the police assault provoking a strong public response.

"Considering the small numbers that we had this morning, it's amazing," said Hady Kamar, a 26 year old artist who was hit twice by rubber bullets, once in the foot and once in the head. "When things looked darkest and the police had pushed us out of Tahrir, we returned in huge numbers. To see this many on the street and feel this much energy, is special. Today it feels like the revolution is back up and running, but we'll see what tomorrow brings. It's always been a day by day struggle."

Reprising many of the slogans used during mass protests against Mubarak, demonstrators vented their anger at Scaf and chanted 'Here is the revolution, nothing else'.

Many expressed scepticism about the elections, saying they were designed to entrench military control over the country, but most insisted they still wanted the vote to go ahead. "The generals want to rule Egypt, but this is our revolution," said Ahmed Mohamed, a 24-year-old accountant. "Look around you – you don't see different political parties or rival candidates, you just see the Egyptian people. People have come down from their homes to join the fight; we are battling the remnants of Mubarak's regime who remain in power at the moment, and both this and the elections are all part of that same process."

Solidarity rallies also erupted in the large cities of Alexandria and Suez. Egypt's interior ministry claimed its forces had acted with restraint, and blamed protesters for escalating tensions so close the parliamentary vote.

On Friday a group of prominent intellectuals, including former UN nuclear weapons chief Mohamed ElBaradei, unveiled an alternative transition plan which would involve postponing the parliamentary ballot and wresting executive control of Egypt away from the armed forces whilst a new constitution is drawn up.

The ruling generals have yet to respond to the proposal.