A road linking Kirkuk and Mosul cuts through Guare and Kurdish combattants were deployed 10 kilometers (six miles) away.

Guare is located 40 kilometers (25 miles) southeast of Mosul and 90 kilometers (56 miles) northeast of Kirkuk.

Kurdish peshmerga fighters were able to make the advance after Iraqi army soldiers pulled back from eight Kurdish towns following a night of heavy air strikes, US special forces backing the Kurds told AFP on condition of anonymity.

The peshmergas inched their way five kilometers closer to Guare, followed by seven members of the US special forces, Kurdish commander Rashid Tahir Nerwani said.

But even as they retreated the Iraqi troops counter-attacked with heavy artillery, triggering more air attacks in a battle that lasted for 30 minutes, Kurdish sources said.

They said the battle was led by members of Iraqi President Saddam Hussein's Baath Party rather than the Iraqi soldiers, who were described as demoralised and extenuated.

Kurdish fighters then managed to secure three of the eight villages that were deserted by the regular Iraqi troops, AFP correspondents said, while some artillery rounds and air attacks continued into the afternoon.

The peshmergas have gained ground into Iraqi government-held territory since Wednesday, moving 18 kilometers deep (11 miles) in that region.

Taking control of Guare could help the US-backed Kurdish fighters push on towards Mosul and Kirkuk and cut communications between Iraqi troops deployed around that area.

SPACE.WIRE