MEXICO CITY, April 14 (Reuters) - Mexico's drug war has escalated as cartels launch military-style attacks on security forces with heavy weaponry, the U.S. State Department warned on Monday.

Americans should be careful when visiting northern Mexican towns near the U.S. border like Tijuana, where dozens of U.S. citizens were kidnapped or murdered in 2007, it said in a travel alert.

Other towns like Ciudad Juarez, just south of El Paso, Texas, and Nuevo Laredo in Tamaulipas state have seen bloody battles between police and smugglers.

"Recent Mexican army and police force conflicts with heavily-armed narcotics cartels have escalated to levels equivalent to military small-unit combat and have included use of machine guns and fragmentation grenades," the alert said.

President Felipe Calderon has been locked in a war with drug cartels since taking office in Dec. 2006. Last year, drug killings exceeded 2,500 and are already above 850 so far this year.

Calderon has deployed some 25,000 soldiers and federal police to fight cartels in drug hot spots across Mexico.

"Criminals are armed with a wide array of sophisticated weapons. In some cases, assailants have worn full or partial police or military uniforms and have used vehicles that resemble police vehicles," the State Department added.

The drug gangs are also fighting among themselves. The most bitter rivalry is between the Gulf Cartel from northeastern Mexico and an alliance of traffickers from the northwestern state of Sinaloa that is headed by Joaquin "Shorty" Guzman. (Reporting by Cyntia Barrera Diaz; Editing by Cynthia Osterman)

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