Thousands of protesters are gathering the Bahraini capital Manama after two days of clashes with police in which two people died.
Many of them have been attending the funeral of the second victim, killed at the funeral of the first.
Some say they will stage a sit-in on the main square until their demands for political reform are met.
Meanwhile the interior minister said police allegedly involved in the killings had been arrested.
Bahrain's King Hamad bin Issa Al Khalifa used a TV address on Tuesday to make a promise to investigate the deaths.
The US, which has a big naval base in Bahrain, expressed concern at the killings and called for restraint.
"The United States is very concerned by recent violence surrounding protests in Bahrain," state department spokesman PJ Crowley said in a statement.
"We also call on all parties to exercise restraint and refrain from violence."
The leader of Bahrain's main Shia opposition party, Sheikh Ali Salman, called for the creation of a "civil government" with an elected prime minister.
"The government should be elected by the people who would have the right to hold it accountable," he said. The king currently appoints the country's head of government.
Mr Salman, who heads the Islamic National Accord Association, said his MPs would boycott parliament until their demands were met.
The disturbances in Bahrain - where the Shia majority has been ruled by a Sunni Muslim royal family since the 18th Century - are part of a wave of anti-government unrest that has swept the Middle East.
Internet restrictedThe Bahraini demonstrators say they want:
- political prisoners to be released
- more jobs and housing
- the creation of a more representative and empowered parliament
- a new constitution written by the people
- a new cabinet that does not include Prime Minister Sheikh Khalifa bin Salman Al Khalifa, who has been in office for 40 years
The funeral is being held for 31-year-old Fadel Salman Matrouk, who was shot dead in clashes at the funeral of a previous victim killed in Monday's clashes in the village of Daih.
King Hamad expressed regret about the deaths
Protesters attending the funeral called for the removal of the government, while pounding their chests in rhythm in a distinctive Shia mourning gesture, Reuters news agency reported.
Many will have had to return to work after Tuesday's public holiday to mark the Prophet Muhammad's birthday, but correspondents say that so far momentum appears to still be with the protests.
In a rare TV appearance on Tuesday, Sheikh Hamad expressed regret at the fatalities and said he would continue reforms begun in 2002 when the emirate became a constitutional monarchy.
Following the address, thousands of protesters gathered in Pearl Square in central Manama. Some said more than 10,000 people were there.
Police were deployed on the other side of a bridge leading to the square, but took no further action.
The Bahrain Youth Society For Human Rights said many of the protesters had brought tents, blankets and carpets.
The group also said the country's internet connections were being restricted to hamper the uploading of videos and pictures from the protests.
Opposition boycottSince independence from the UK in 1971, tensions between the Sunni elite and the less affluent Shia have frequently caused civil unrest. Shia groups say they are marginalised, subject to unfair laws, and repressed.
“Start Quote
End Quote Anmar, ManamaWhat happened in Tunisia and Egypt has encouraged us to move forward to ask peacefully for our demands”
The conflict lessened in 1999 when Sheikh Hamad became emir. He freed political prisoners, allowed exiles to return, and abolished a law permitting the government to detain individuals without trial for three years.
He also began a cautious process of democratic reform. In 2001, voters approved a National Action Charter that would transform Bahrain into a constitutional monarchy. The next year, Sheikh Hamad proclaimed himself king and decreed that a National Assembly be formed.
There was also greater protection of democracy and human rights. Although political parties were banned, "political societies" could operate.
Landmark elections were held in 2002, but the opposition boycotted them because the appointed upper chamber of parliament, the Shura Council, was given equal powers to the elected lower chamber, the Council of Representatives.
The BBC's Kevin Connolly says Bahrain has a close relationship with the US and the US Fifth Fleet has its home there - a factor which guarantees that Washington will be watching events in the kingdom closely.
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