The government says it is tackling armed terrorist gangs.
More than 1,700 people have reportedly died in the six-month uprising against the rule of President Bashar al-Assad.
'Shooting is intense' The Ramel quarter and neighbouring areas are said to be under constant heavy gunfire as tanks and troops move through the streets.
The assault began on Saturday, a day after mass anti-government protests in the city.
On Sunday activists said Syrian warships had joined the attack, firing shells on the city.
One resident of Ramel told Associated Press news agency: "We are being targeted from the ground and the sea. The shooting is intense. We cannot go out. They are raiding and breaking into people's homes."He said that at least three gunboats were taking part and mosques had been targeted.
The London-based Syrian Observatory for Human Rights said at least one young child had been killed.
State television denied any shelling had happened.
It said the security forces were fighting "armed terrorist gangs" who had set up barricades and were shooting from rooftops.
The government said three members of the security forces were killed and 40 wounded in clashes.
Activists deny that their movement is armed but said at least one officer and a number of soldiers had defected to join the uprising.
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Latakia has seen many anti-government protests in the past six months.
Syria has come under increased diplomatic pressure in the past week to stop its crackdown on the dissent.
The US has imposed sanctions on Damascus and has said these could be increased, while calling on other countries to follow.
Saudi Arabia, Bahrain and Kuwait have all recalled their ambassadors, while Turkish Foreign Minister Ahmet Davutoglu has described the methods used by the Syrian security forces as "unacceptable".
Mr Assad has reiterated promises of political reform, while remaining adamant his government would continue to pursue the "terrorist groups" he has blamed for the unrest.
Protests have been targeted in Homs, Hama, Damascus, Deir al-Zour in the east, Deraa in the south and Aleppo and Idlib near Turkey's border.
A doctor in Hama told the BBC that medical services there had been severely affected by recent government attacks. He said two hospitals were closed and one had been stormed by troops, injuring many of the medical staff.
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