| MONTERREY, Mexico
MONTERREY, Mexico For Mexicans living in the battleground between two of the country's biggest drug gangs, the threat of even worse violence is rising as the Zetas try to grab the turf of the Gulf cartel's dead kingpin.
"We're all very afraid of what's coming," said Julio, a car wash worker in the city of Matamoros, just across the border from Brownsville at the southern tip of Texas. "This was already a war zone and it is only going to get worse."
The killing of Ezequiel "Tony Tormenta" Cardenas, head of the Gulf cartel, by Mexican marines last week was a brief victory in President Felipe Calderon's fight against the gangs warring over smuggling routes into the United States.
Since the death of Cardenas, cartel roadblocks and gunfights have intensified across Matamoros and nearby Reynosa and Monterrey, Mexico's richest city. The Zetas have strung up threatening banners on major roads in the cities.
Antonio Garza, police chief of northeastern Tamaulipas state that is home to Matamoros, warned of a "collective psychosis" since Friday's killing of Cardenas, with many fearful residents staying home and schools being closed.
Hundreds of university students were evacuated on Tuesday in a series of bomb scares in Matamoros, after 10 high schools received similar warnings on Monday.
All turned out to be false and no one was injured but residents have good reason to be scared. Since December 2006, when Calderon launched his crackdown, more than 31,000 people have been killed across Mexico in drug-related violence.
Cardenas -- the brother of former Gulf cartel leader Osiel Cardenas, who was extradited to Texas in 2007 -- was killed in a hail of grenades and gunfire after marines closed in on him in a house in downtown Matamoros.
No photos of his body have surfaced. Journalists and civil protection sources in Matamoros said he was buried on Monday in the port city but officials declined to comment.
Cardenas was the fourth drug baron to be killed or captured since last December.
But drug trade analysts see more violence as the Zetas, the Gulf cartel's former armed wing, fight to win back power in Reynosa and Matamoros, both manufacturing cities where investment is being frozen because of the violence.
"Tony Tormenta's death means the Zetas are likely to attempt to regain influence in these regions and perhaps even mount an all-out assault," U.S. security consultancy Stratfor said in a report. "As a result, violence in the region is likely to spike in the short term."
Headed by Heriberto "The Executioner" Lazcano, the Zetas split from the Gulf cartel earlier this year and are blamed for some of the worst atrocities in the drug war, including the murders of 72 migrants in August.
Founded in the late 1990s by about 40 soldiers who deserted army special forces units to work for the Gulf cartel, the Zetas may now number 10,000 across Mexico and Central America.
Mexico's most wanted man, Joaquin "Shorty" Guzman, who leads the powerful Sinaloa cartel, could also wade in and try to take over the lucrative smuggling routes.
"It opens a valuable space to secure a new position and to launch a counter-offensive," said Pedro de la Cruz, a security analyst at Mexico's National Autonomous University.
Guzman could exploit the vacuum by allying himself with the Gulf cartel. There may also be a power struggle within the Gulf cartel, said security analyst Alberto Islas.
Cardenas ran the gang with Jorge Eduardo Costilla, known as "El Coss," who is still at large.
"Obviously there's going to be a settling of scores and if Tony Tormenta's henchmen don't get 100 percent in line behind El Coss ... they are going to disappear," Islas said.
(Additional reporting by Miguel Angel Gutierrez; Editing by John O'Callaghan)