Lawmakers fled and several senior government figures were rescued by military helicopter after the red-shirted supporters of Thaksin Shinawatra forced their way into the parliamentary compound briefly on Wednesday.
The protesters idolise ousted former premier Thaksin and tens of thousands of them have been rallying in the Thai capital for weeks, at one point splashing their own blood at key locations in a grisly show of defiance.
To contain the growing crisis, Prime Minister Abhisit Vejjajiva invoked emergency rule Wednesday, banning public gatherings of over five people and giving broad powers to police and military in Bangkok and surrounding areas.
"The state of emergency aims to resolve the situation and bring a return to normal," Abhisit told a nationally televised news conference.
The premier, who has cancelled a trip to the US for a nuclear security summit next week due to the unrest, said the mass rallies were unconstitutional and had tarnished the country's image, eroding investor confidence.
It is the fourth time since 2008 that emergency law has been declared in the capital because of political turmoil.
But thousands of protesters flouted the decree, waving flags and cheering as their leaders railed against Abhisit's government from their rally stage close to a clutch of luxury hotels and giant shopping malls.
"We have to prepare for another war. If the military comes you should not panic -- just stay put," Reds leader Veera Musikapong told protesters.
Tens of thousands of anti-government protesters have refused to leave the city's main commercial district, where they have been since Saturday, disrupting traffic and causing major stores to shut.
Deputy Prime Minister Suthep Thaugsuban urged people with relatives rallying in banned areas "to tell them to leave immediately," adding that authorities would provide transportation for demonstrators from outside Bangkok.
The United States Wednesday rebuked the protesters.
"We respect the right of freedom of expression," said State Department spokesman Philip Crowley, but he added "forcibly entering government buildings is not an appropriate means of protest."
Security forces have so far refrained from using force to disperse the red-clad movement, who have vowed to keep up their demonstrations despite the emergency decree.
The Reds have been emboldened after the police and army backed down on Tuesday following a tense standoff in the capital's tourist heartland.
The Red Shirts say the government is illegitimate because it came to power with army backing through a parliamentary vote in December 2008 after a court decision ousted Thaksin's allies from power.
The mainly poor and rural followers of Thaksin, a billionaire telecoms tycoon who lives abroad to avoid a jail term for corruption, fervently support the populist policies he introduced before his ouster in a 2006 coup.
Thaksin sought to rally his supporters on Wednesday in a brief message through the micro-blogging service Twitter, praising their "courage, patience and unity."
The military has mounted a heavy security response, deploying 50,000 personnel at one point to try to contain the protests, which drew as many as 100,000 people on March 14.
But the government wants to avoid a repeat of last April's clashes with Red Shirts that left two people dead, six months after riot police took on the rival Yellow Shirts in bloody scenes outside parliament.
David Mikael Taclino
Inyu Web Development and Design
Creative Writer
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