Containers of a chemical suspected to be chlorine were dropped by helicopters on rebel-held east Aleppo, causing breathing difficulties in some people, the Syrian Observatory for Human Rights and the local health authority say.
The Britain-based war monitor said its network of sources had reported seeing at least four barrel bombs dropped on the al-Qaterji and Dahrat Awad neighbourhoods, with the smell of chlorine filling the area on Tuesday.
Medical sources told the Observatory they thought the gas was chlorine.
Related reading
Syrian government declines UN offer on east Aleppo
The Aleppo Health Directorate for east Aleppo said there were a number of cases of breathing difficulties reported.
Earlier on Tuesday the Syrian army advised civilians in besieged east Aleppo to avoid going into the streets and to steer clear of militant positions, and urged rebels to stop firing into government-held western Aleppo.
On November 11, the executive body of the global chemical weapons watchdog OPCW condemned the alleged use of banned toxic agents by the Syrian government and by militant group Islamic State.
A 13-month international inquiry by the OPCW and United Nations concluded in a series of reports that Syrian government forces, including helicopter squadrons, were responsible for the use of chlorine barrel bombs against civilians.
Syrian authorities deny having used chemical weapons in the conflict. Islamic State has not commented.
At least 143 civilians, including 19 children, have been killed in the city's east since the latest assault began on November 15, according to the monitor.
Another 16 civilians, including 10 children, have been killed in rebel fire on government-controlled western Aleppo, it said.
Related reading
UN warns time 'running out' in Aleppo
Civilians flee to southern Aleppo as regime advances
Syrian pro-government forces pushed deeper into rebel-held eastern Aleppo on Tuesday, forcing civilians to flee to southern neighbourhoods to escape the onslaught as the regime pressed an assault to recapture the entire city.
Recapturing east Aleppo would be the government's biggest victory yet in Syria's five-year conflict and deal a potentially decisive blow to the opposition.
The city was once the country's economic powerhouse, but it has been ravaged by the war that has killed 300,000 people since it began with anti-government protests in March 2011.
Military aircraft dropped leaflets over east Aleppo, urging rebels to distribute food to civilians, leave the area and allow residents to do so too.
Related reading
Six-year-old boy pulled alive from Aleppo rubble
Government forces pounded the area with air strikes and barrel bombs as ground troops advanced in the key eastern district of Masaken Hanano, the Syrian Observatory for Human Rights said.
A week into the latest round of fighting for the city, the regime controls around a third of the district, the Observatory said.
The area has been shelled heavily during the war, and many residents had already fled, but the latest fighting prompted even the last holdouts to leave.
Milad Shahabi, a member of the local council, told AFP that residents were fleeing to southern parts of the opposition-controlled east.
Masaken Hanano was the first Aleppo district to fall to rebels in 2012, and it is strategically vital.
Observatory head Rami Abdel Rahman said that if regime forces manage to take the district they will be able to "cut off the northern parts of rebel-held Aleppo from the rest of the opposition-held districts".
'Now it's too late'
For the past four years, Aleppo has been divided between the government-controlled west and rebel-held east, which has been sealed off from the outside world since the army surrounded it in mid-July.
No food aid has entered since then, and locals suffer severe shortages of food, fuel, electricity and water.
Rebels have tried several times to break the siege, without success.
The UN's aid chief Stephen O'Brien on Monday slammed the use of sieges in Aleppo and elsewhere. In remarks to the Security Council, he said nearly one million Syrians were living under blockade.
Emile Hokayem, a senior fellow at the International Institute for Strategic Studies, said there was very little the world could now do to prevent the whole city falling to pro-regime forces.
Related reading
We may take more Syrian refugees: Dutton
"You can't send weaponry in any more, all the supply roads are cut, and you won't intervene from the air because of the costs and the risks," he told AFP.
"There was a time to do something about Aleppo... but now it's too late."
Russia, meanwhile, accused the UN's Syria envoy of torpedoing a Security Council resolution to revive peace talks between the regime and opposition.
"The United Nations in the form of its special representative Staffan de Mistura has been sabotaging the resolution for more than six months," Russian Foreign Minister Sergei Lavrov said.
The resolution calls for "holding inclusive Syrian talks without preconditions", he said.
And in Washington, the Pentagon said a US drone strike had killed a senior Al-Qaeda leader in northwestern Syria.
The November 18 strike near Sarmada targeted Abu Afghan al-Masri, Pentagon press secretary Peter Cook said.
"He had ties to terrorist groups operating throughout Southwest Asia, including groups responsible for attacking US and coalition forces in Afghanistan and those plotting to attack the West," Cook said.
