* Rioting, looting spread across British capital

* Youths laugh, hurl bottles at police

* Looting breaks out in three other cities

(Adds Liverpool, Bristol, colour from Woolwich, Ealing)

By Stefano Ambrogi and Mohammad Abbas

LONDON, Aug 8 (Reuters) - Rioting and looting spread across and beyond London on Monday as hooded youths set fire to cars and buildings, smashed shop windows and hurled bottles and stones at police in a third night of violence in Britain's worst unrest in decades.

Prime Minister David Cameron cut short his holiday to fly home to tackle the violence, which appeared to be led by mobs of young people who coordinated their attacks through mobile phones, and spread to the Midlands city of Birmingham, the northwestern city of Liverpool and Bristol late on Monday.

Many of the looters came from areas of high unemployment that are also suffering from cuts in social services and said they felt alienated from society. Police and politicians said they were simply criminals.

"It's been building up for years. All it needed was a spark," said E. Nan, a young man in a baseball cap surrounded by other youths in Hackney in east London. "We ain't got no jobs, no money ... We heard that other people were getting things for free, so why not us?"

The violence erupted late on Saturday in London's northern Tottenham district when a peaceful protest over the police shooting of a suspect two days earlier was followed by outbreaks of looting and arson.

By Monday, the violence had spread to parts of the south of the city, including Clapham Junction, one of London's busiest railway junctions, Woolwich in the capital's southeast, Ealing in west London and the southern suburb of Croydon.

Rioting spreading beyond the capital, and police said they