Pakistan's army says it has recaptured several areas of Mingora, the main city in the Swat valley, as its offensive against the Taliban continues.
A security official said soldiers were now clearing landmines in those sections back under government control.
But clashes are still continuing with soldiers and militants engaged in hand-to-hand fighting at some of the city's main intersections, the army says.
The fighting began after a peace deal broke down earlier this month.
Hundreds have died and over a million have fled Swat since the operation against the Taliban was launched.
The success of Pakistan's military operation in the region hinges on a swift victory in Mingora, according to the BBC's Shoaib Hasan in Islamabad.
This fresh assault on the Taliban has the full backing of the US, which has identified Pakistan and Afghanistan as central to the international battle against Islamist extremism.
Surrounded
Although the military has always had bases inside Mingora, the city has effectively been under Taliban control in recent weeks.
The military now says Mingora is surrounded, and most of the militants' ammunition dumps have been destroyed.
Journalists are not being allowed near the city, so it is not possible to verify the claims.
The army has also said it has gained control of several important intersections, including Green Square where the Taliban is thought to have carried out several beheadings.
A local citizen in Mingora confirmed this, but told the BBC that fighting was continuing around four nearby villages: Takhtaband, Garozai, Nawakalay and Shahdara.
The military claim to have killed 17 Taliban militants - a figure the Taliban denies.
The army also said it had made progress in other parts of the Swat valley, with the city of Matta reportedly cleared of militants.
 Most people in Pakistan support the military offensive in Swat |
But army spokesman Major General Athar Abbas warned that the operation in Mingora could be "painfully slow", as up to 20,000 civilians were still trapped there.
"This is an extremely difficult, extremely dangerous operation because clearance has to be done street by street, house by house," he told reporters on Saturday.
A curfew remains in place in the city, and there are already reports of many civilian casualties, but these cannot be independently confirmed.
Humanitarian crisis
Our correspondent says the Swat battle is the most important yet in the army's offensive against the Taliban in north-west Pakistan.
A swift victory would bolster public support for a greater fight against the militants, our correspondent adds.
But anything other than complete victory could quickly diminish public support for the campaign, he adds - which would be disastrous for Pakistan's fragile political coalition and the long-term war against militancy in the region.
Nearly 1.5 million people have been displaced by this month's fighting in the north-western region, and about two million since last August, the United Nations refugee agency says.
Helped by a massive influx of foreign aid, Pakistan has been able to deal with the situation so far, but if the situation gets worse aid workers will find it increasingly difficult to deal with the tide of displaced people.
In separate developments over the weekend:
- Pakistani aircraft have bombed Taliban militants near Orakzai tribal area, killing at least seven people. The militants are thought to have been preparing to travel to South Waziristan on the Afghan border.
- Police say a French tourist has been kidnapped by gunmen in the southern Baluchistan province. Four other French nationals travelling with the tourist reported the kidnapping.
Pakistan's army began an offensive against the Taliban on 2 May after the peace deal broke down and the militants began expanding their area of influence.
In Swat, the army says that about 15,000 members of the security forces are fighting between 4,000 and 5,000 militants.
It says more than 1,000 militants and more than 50 soldiers have been killed since the offensive began.
Source: bbc News
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