Iraq's western city of Fallujah has been "liberated" from Daesh, Prime Minister Haider al-Abadi said on Friday, marking a major setback to the extremist militia.
"Fallujah has returned to the homeland. Our troops are in control of the city and have tightened their grip on its centre," al-Abadi added in a televised address.
His announcement came hours after US-backed Iraqi forces retook key installations, including a government compound and a major hospital, in the centre of Fallujah from Daesh.
Fallujah, around 50 kilometres west of the capital Baghdad, was the first Iraqi city to fall to Daesh in early 2014. The al-Qaeda splinter group seized more territory in the country in a lightning attack months later.
"Operations in Fallujah continue," Pentagon spokesman Matthew Allen said in statement. "The Iraqi-led ground forces have taken the town centre and are working to eliminate remaining [Daesh] elements within the city."
The hardline jihadists still control areas in Iraq's Sunni Arab north and west, including Mosul, the country's second-largest city.
Al-Abadi Friday vowed that Mosul will be the next target of the Iraqi forces.
"There is no place for Daesh in Iraq," he said, using an Arabic acronym for Islamic State. "Leave our country. Iraq is only for Iraqis."
He added that there are still some areas inside Fallujah that need to "be cleansed" from militants. No details were given.
On May 23, Iraqi government forces, backed by a powerful Shia militia and US-led air power, started an onslaught to dislodge the extremist Daesh fighters from Fallujah, a main city of the mostly Sunni province of Anbar.
Thousands of locals have since fled the fight in Fallujah amid reports that other thousands have been trapped inside the city.
In recent weeks, Daesh has been under intense military pressure in Iraq, neighbouring Syria and Libya in North Africa.
By Kadhem al-Attabi and Ziad Haris
