FACTBOX: What is Georgia's rebel South Ossetia region?

(Reuters) - Fighting raged in and around the capital of Georgia's breakaway South Ossetia region on Friday as Georgian troops and warplanes pounded separatist forces in a bid to re-take control of the territory.

Here are key facts about the region:

GEOGRAPHY:

-- South Ossetia is a territory of around 1,500 sq miles about 100 km (60 miles) north of the Georgian capital Tbilisi, on the southern slopes of the Caucasus mountains.

SEPARATISM:

-- The collapse of the Soviet Union spurred a separatist movement in South Ossetia, which had always felt more affinity with Russia than with Georgia. It broke away from Georgian rule in a war in 1991-92 in which several thousand people died, and maintains close ties with the neighboring Russian region of North Ossetia, on the north side of the Caucasus.

-- The majority of the roughly 70,000 people are ethnically distinct from Georgians, and speak their own language, related to Farsi. They say they were forcibly absorbed into Georgia under Soviet rule and now want to exercise their right to self-determination.

-- The separatist leader is Eduard Kokoity. In November 2006, villages inside South Ossetia that are still under Georgian control elected a rival leader, ex-separatist Dmitry Sanakoyev. He is endorsed by Tbilisi, but his authority only extends to a small part of the region.

RUSSIAN SUPPORT:

-- Around two-thirds of annual budget revenues of around $30 million come directly from Moscow. Almost all the population hold Russian passports. They use the Russian ruble as their currency.

-- Russia's state-controlled gas giant Gazprom is building new gas pipelines and infrastructure, worth some 15 billion rubles ($640 million), to supply the region from Russia.

CONFLICT:

-- A peacekeeping force with 500 members each from Russia, Georgia and North Ossetia monitors a truce. Georgia accuses the Russian peacekeepers of siding with the separatists, which Moscow denies. Sporadic clashes between separatist and Georgian forces have killed dozens of people in the last few years.

-- Georgian President Mikheil Saakashvili has proposed a peace deal under which South Ossetia would be given "a large degree of autonomy" within a federal state. The separatist leaders say they want full independence.