MONTERREY, Mexico (Reuters) - Masked gunmen killed at least 53 people at a casino in northern Mexico on Thursday, leaving it ablaze with patrons trapped inside in one of the worst attacks in a major Mexican city in years.

Analysts and officials said the brazen assault had all the hallmarks of drug cartels that have plunged Monterrey and other parts of Mexico into a spiral of violence.

A survivor said the armed men burst into the Casino Royale in the prosperous industrial city of Monterrey on Thursday afternoon and threatened gamblers before spraying gasoline on the carpets and setting it on fire.

"My wife came here for a celebration," a weeping man told Milenio TV. "She was having dinner with her friends."

One witness said people stampeded after hearing blasts soon after the attack began. Many patrons ran to hide in the toilets but died from asphyxiation as smoke engulfed the building, a rescue official said.

Rodrigo Medina, governor of Nuevo Leon state, told the Televisa network that 53 people were killed and rescue teams warned the death toll could rise. Media reports said the majority of those killed were women.

Monterrey, 230 km (140 miles) from the Texas border, is a relatively wealthy city of about 4 million people and was for years seen as a model of economic development. But lawlessness has taken its toll as Mexico's drug war has escalated.

President Felipe Calderon called the attack a "barbaric act of terror" and vowed to keep fighting organized crime.

About 42,000 people have been killed in the drug war across Mexico since Calderon took office in late 2006 and deployed troops against the drug cartels.

Alberto Islas, a security expert at consultancy Risk Evaluation, said Thursday's carnage showed Calderon's strategy had failed to curb the power of the cartels.

"The impunity and lack of investigation were the most obvious incentives for the criminals to carry out this act of violence," Islas said. "At the end of the day, they know nothing will be done about it."


Rival drug gangs are fighting for control of Monterrey and routinely extort casinos and other businesses, threatening attacks if the owners refuse to pay.

Televisa said up to 20 more bodies still might be trapped in the debris of the casino. Paramedics and firefighters pulled out bodies covered with plastic bags from a hole in the wall as night fell.

Relatives of people trapped in the casino lined up to demand information while others used social media to start their own searches.

"My sister was working inside as a waitress," said one man. "I know nothing about her. There is only confusion."

National security spokesman Alejandro Poire said the government would do everything in its power to stop the violence and capture those responsible for the casino attack.

Rescuers used an excavator from a nearby construction site to break through a casino wall to search for victims.

Twitter users in Monterrey reported scenes of chaos on the streets around the Casino Royale after the attack and heavy army presence.

Casinos have become popular in Mexico and a number of them have been attacked in recent years. The Milenio newspaper said on Thursday a casino in the state of Coahuila was attacked by a group of armed men.

(Additional reporting by Cyntia Barrera Diaz and Dave Graham; Editing by Kieran Murray and John O'Callaghan)

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