Afghan commanders have appealed for more Nato support amid reports that government forces have lost control of the key strategic town of Sangin to the Taliban.
A spokesman for the insurgents claimed the entire Sangin district - once held by British forces - had "completely collapsed" to them.
The claim was denied by officials in Kabul, but the deputy governor of Helmand province said all lines of communication with the town had been cut and there was no information as to what was happening inside.
Earlier, following days of fierce fighting, Afghan defence minister Masoom Stanekzai said that reinforcements had been rushed to the area to support the besieged government force.
However he said that they remained overstretched forces and needed additional international back-up, particularly close air support.
"The Helmand battle is not easy because the province has a long border, is a core of opium production, and our enemies are well-equipped and deeply involved in the smuggling of drugs," he said. "These factors complicate the battle for Sangin."
Britain has sent a small contingent of around 10 troops to Helmand to act as advisers to the Afghan forces, although the Ministry of Defence has made clear they will not take part in combat operations.
However former foreign secretary David Miliband said Britain should do more to help restore stability to the country in the face of the continued Taliban onslaught.
"Given the level of sacrifice but also the importance strategically of Afghanistan as an entry point into central Asia, as a potential expansion ground for Isis and others - I think it is important for Britain to be part of the overall strategy to stabilise the country. Above all that needs to be a political strategy," he told the BBC Radio 4 Today programme.
The fall of Sangin would be particularly sensitive in the UK as more than 100 British soldiers died there amid some of the fiercest fighting of the 13-year combat mission.
The Taliban spokesman for southern Afghanistan, Qari Yousaf Ahmadi, claimed on Twitter that "Sangin district has completely collapsed to the Taliban" and that they had captured Afghan soldiers and ammunition.
Helmand's deputy governor Mohammad Jan Rasulyar said that the situation in the town was unclear but acknowledged that the position was desperate.
"We already said that our forces are weak and need backup but because we have no communication with our forces, we don't know whether the Taliban have captured Sangin or not," he said.
An Afghan army soldier, Yaseen Zamarai, contacted by Associated Press by telephone inside the besieged base in Sangin said the Taliban were outside the building where they were holding out.
"We need help, we can't hold them for much longer," he said. "It's not that we are afraid of death, but we didn't think that our brothers would leave us like this."