African Union-backed Somali government troops attacked and seized positions of hardline Shebab insurgents in the war-torn capital Mogadishu on Friday, officials said.
An artillery barrage at daybreak poured down on a northeast district -- which AU forces claim was already largely abandoned by civilians -- before tanks and ground troops moved into the area.
"We have advanced on their last positions in Suqaholaha district, taking control of key locations," said Somali military commander Abdulahi Ali Anod.
"The terrorist remnants... are now on the run," he added.
The assault was the latest in a long-running offensive to drive the Al-Qaeda allied Shebab from holdout positions, after most of the insurgents last year left fixed defences in Mogadishu and switched to guerrilla attacks.
The Suqaholaha neighborhood is the last main Shebab stronghold in the anarchic capital, and the attack comes two weeks after AU troops launched a similar offensive in southern Mogadishu.
"Today's operation has successfully extended the city's defences," said Ugandan Major General Fred Mugisha, commander of the African Union mission in Somalia (AMISOM).
It "will deny the terrorists important ground from which they have been attacking the population," Mugisha said in a statement, adding that two AU troops were injured during the fighting.
Extremist Shebab gunmen have been fighting to topple the weak Western-backed Somali government in Mogadishu, where the administration survives under the protection of the 10,000-strong AU force.
"There was heavy shelling by the AMISOM peacekeepers this morning... I saw three injured soldiers carried on a pickup truck," said witness Abdulahi Nuradin, adding that tanks and troops had now moved into the former rebel area.
Somalia has had no effective government since 1991 and in recent years the Shebab rebels and other groups have taken an increasing hold on large parts of the country.
Osama bin Laden's successor Ayman El-Zawahri announced last month that Shebab fighters had joined forces with Al-Qaeda.
But the Shebab rebels have been weakened since Kenya and Ethiopia deployed forces late last year to the lawless Horn of Africa country to defeat the insurgents they blame for causing insecurity in the region.
The Kenyan forces in the far south have carried out aerial and ground assaults against the extremist militia, while Ethiopian troops in the west last week wrested control of the southern Baidoa town from the rebels.
However, experts warn the Shebab are far from defeated and remain a major threat, especially if they switch to guerrilla tactics as they have done with devastating impact in the capital, where bomb and grenade attacks are common.
Last week, an international conference in London pledged to help end the chaos in Somalia, which for the past 20 years has had no central government and has been at the mercy of warlords, pirates and Islamist extremists.