* Separatists seize Luhansk regional government HQ
* Gunmen open fire on police headquarters
* Kiev says police did not oppose storming of building
* OSCE military observers still held in east Ukraine (Adds shooting, more buildings seized)
By Vasily Fedosenko
LUHANSK, Ukraine, April 29 Pro-Russian separatists opened fire on a police station in the city of Luhansk on Tuesday after seizing the regional government headquarters, as Kiev's control over swathes of eastern Ukraine evaporates.
The shooting, which followed a day of largely unopposed action at other sites, did not appear to cause casualties but a tense confrontation continued with police officers inside.
Earlier, pro-Moscow activists took the headquarters of the government of Luhansk region, the second such institution to fall this month after that of neighbouring Donetsk region.
Lines of riot police had surrounded the back of the government building, facing hundreds of men and women. But at the front, dozens of men, some in green camouflage and holding shields, had walked unopposed into the imposing, white building, while others smashed windows and raised the Russian tricolour.
The regional prosecutor's office and television centre were next to fall, a Reuters photographer at the scene said, before around 20 gunmen opened fire with automatic rifles on the local police headquarters, demanding police surrender their weapons. A tense stand-off ensued and protesters burned the Ukrainian flag.
The government in Kiev has all but lost control of its police forces in parts of eastern Ukraine since pro-Russian activists seized buildings in the region's second biggest city of Donetsk and several smaller towns.
Acting President Oleksander Turchynov demanded the interior ministry dismiss police chiefs in Luhansk and Donetsk - the two regions that make up the bulk of Ukraine's heavily populated industrial base in the Donbass coalfield.
"The overwhelming majority of law enforcement bodies in the east are incapable of fulfilling their duty to defend our citizens," he said in a statement.
Stanislav Rechynsky, an aide to Interior Minister Arsen Avakov, said of Luhansk: "The regional leadership does not control its police force. The local police did nothing."
OPPOSITION TO SANCTIONS
Ukraine's authorities are struggling to find a way to evict the separatists, who also took a small town hall in Pervomaisk in Luhansk region on Tuesday.
Kiev launched an "anti-terrorist" operation in early April, but so far it has failed to yield many results.
Some separatists have begun to call the shots.
Vyacheslav Ponomaryov, the self-declared mayor of Slaviansk, told Interfax news agency that EU sanctions against two other rebel leaders were "not conducive to dialogue" on releasing seven military observers detained after being accused of harbouring a Ukrainian spy.
The observers had travelled to eastern Ukraine under the auspices of the Organization for Security and Cooperation in Europe (OSCE), a democracy watchdog.
"If they fail to remove the sanctions, then we will block access for EU representatives, and they won't be able to get to us. I will remind my guests from the OSCE about this," he said.
OSCE Secretary General Lamberto Zannier visited Kiev to discuss the detention, telling reporters: "We are dealing with this issue. We are very concerned, of course."
Separatists in Donetsk, eastern Ukraine's second biggest city, have said they will hold a referendum on independence for the Donbass region on May 11.
That would undermine government efforts to hold a non-binding consultative referendum across Ukraine on May 25 or June 15, when the country votes for the president, to gauge appetite for the decentralisation of power.
Russia has denied suggestions that it is orchestrating events in eastern Ukraine or that it plans to invade eastern Ukraine, which is home to many Russian speakers, following its annexation of the Crimea peninsula. (Additional reporting by Pavel Polityuk in Kiev; Writing by Elizabeth Piper and Matt Robinson; Editing by Alastair Macdonald)