Ethiopia's capital, Addis Ababa, threatened to "crush" any attack while around 20 military vehicles from Ethiopia crossed into Somalia at Dollow on Wednesday.
Analysts believe Addis Ababa has sent up to 5,000 troops into Somalia, and is massing many more on the border.
"God willing, we will remove the Ethiopians in our country and wage a jihadi war against them," said Shaikh Mukhtar Robow, a senior Muslim in charge of defence.
Nominal Christian Ethiopia, which condemns the Muslim leaders as "terrorists", fears having a hardline Muslim state on its doorstep.
Somalia's government and Ethiopia were on high alert after Muslims advanced on Baidoa city on Wednesday.Also took the capital Mogadishu from US-backed warlords last month.
Ethiopia supports the government of Somali President Abdullahi Yusuf, based in Baidoa, because it lacks the strength to move into Mogadishu.Last Mod: 00 0000, 00:00