* Turkish military hits 181 targets with air strikes, artillery
* Kurdish militia says five civilians, three fighters killed
* President Trump says incursion is "bad idea"
* Rockets fired from Turkey into Syrian border town of Tel Abyad
* U.N. Security Council to meet on Thursday (Releads with ministry statement, troop movements, wall opening)
By Daren Butler
ISTANBUL, Oct 10 (Reuters) - Turkey said its forces seized designated targets on the second day of an offensive against a Kurdish militia in Syria, after a withdrawal by U.S. forces opened up a dangerous new phase in the region's eight-year-old conflict.
Senior members of U.S. President Donald Trump's own Republican Party condemned him for making way for the incursion and abandoning Syrian Kurds, who have been loyal allies of Washington in the fight against Islamic State in Syria.
NATO-ally Turkey has said it intends to create a "safe zone" for the return of millions of refugees to Syria. But world powers fear Turkey's action could deepen the conflict, and runs the risk of Islamic State prisoners escaping from camps amid the chaos.
The Kurdish-led authority in northern Syria said a prison struck by Turkish shelling holds "the most dangerous criminals from more than 60 nationalities" and Turkey's attacks on its prisons risked "a catastrophe".
The Kurdish-led Syrian Democratic Forces (SDF) holds thousands of Islamic State fighters and tens of thousands of their relatives in detention.
Turkey said its offensive was making gains.
"Our heroic commandos taking part in Operation Peace Spring are continuing to advance east of the Euphrates (river)," the Defence Ministry wrote on Twitter. "The designated targets were seized," it said in a later statement.
CNN Turk broadcast video showing a crane overnight removing a concrete block from the border wall and commandos moving in single-file alongside the barrier.
In the Turkish border town of Akcakale, around 30 vehicles carrying Syrian rebels, many pick-up trucks mounted with anti-aircraft machines drove along the main along the Turkish side of the border from Syria's Tel Abyad, a Reuters journalist said.
VOLLEYS OF ROCKETS
They were accompanied by some 10 Turkish military armoured vehicles. It was not clear where they were heading. Earlier, a witness in Akcakale said volleys of rockets were fired from there across the border.
Turkish forces shelled targets near Ral al Ain on Thursday morning, and SDF fighters responded, a witness said.
The Turkish military has hit 181 targets of the Kurdish militia with its air force and artillery since the start of operation into northeast Syria, the ministry said.
One of the prisons where Islamic State detainees are held was hit by a Turkish air strike, the SDF said on Twitter.
The U.S. military has taken custody of two high-profile IS militants previously held in Syria by the SDF and moved them out of the country to a secure location, a U.S. official said.
A second U.S. official said they belonged to a group of British fighters nicknamed "The Beatles," who have been tied to the murder of Western hostages.
Turkish President Tayyip Erdogan's communications director, in an article published hours before the offensive started, said Trump had agreed to transfer leadership of the international campaign against Islamic State to Turkey.
Fahrettin Altun said Turkey had helped Syrian rebels holding IS captives earlier in Syria's war, adding it was in Turkey's interest "to preserve what the United States has accomplished".
Akcakale was quiet for much of the morning after sporadic gunfire and the sound of tank movement were heard in the early hours, Reuters journalists said. Explosions had rocked Tel Abyad earlier in the night, they said.
Turkey regards the Kurdish militia as a terrorist group because of its links to Kurdish PKK militants waging a decades-old insurgency in southeast Turkey.
Troops entered Syria at four points, two of them close to Tel Abyad and two close to Ras al Ain further east, according to Turkish media reports. Air strikes killed at least five civilians and three SDF fighters, while dozens of civilians were wounded, the SDF said. Thousands of people fled Ras al Ain towards Hasaka province, held by the SDF.
SDF spokesman Mustafa Bali said the group's fighters had repelled a ground attack by Turkish troops in Tel Abyad.
SECURITY COUNCIL MEETING
President Trump called the Turkish assault a "bad idea" and said he did not endorse it. He said he expected Turkey to protect civilians and religious minorities and prevent a humanitarian crisis - as Turkey has said it would.
The United Nations Security Council will meet on Thursday to discuss Syria at the request of the five European members, Britain, France, Germany, Belgium and Poland.
In a letter to the 15-member Council seen by Reuters, Turkey said that its military operation would be "proportionate, measured and responsible."
The 22-member Arab League said it will hold an emergency meeting on Saturday.
On Wednesday Trump defended U.S. policy towards Kurds, saying it had sent them "tremendous amounts" in arms and funds.
"The Kurds are fighting for their land...As somebody wrote in a very powerful article today, they didn't help us in the Second World War, they didn't help us with Normandy as an example... But they were there to help us with their land, and that's a different thing," Trump said.
"With all of that being said we like the Kurds."
But one of Trump's closest fellow Republican allies, Senator Lindsey Graham, said failing to support the Kurds would be "the biggest mistake of his presidency".
The Syrian Kurdish group was for years one of Washington's main allies in Syria and the incursion was potentially one of the biggest shifts in years in the Syrian war that has drawn in global and regional powers.
The Kurds played a leading role in taking territory from IS, and now hold the largest swathe of Syria outside of the hands of President Bashar al-Assad. (Additional reporting by Orhan Coskun in Ankara; Editing by Simon Cameron-Moore, William Maclean)
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