Somali Islamic fighters have captured the town of Jowhar from warlords a week after driving them from the capital, Mogadishu, 90km to the south.
The militia loyal to the Union of Islamic courts attacked the town just hours after warlords widely reported to have been backed by the US, fled north.
Reports indicate the town was quickly overrun and at least one person died.
Warlords controlled Mogadishu for 15 years, but have became isolated as the influence of the Islamists has grown.
On Tuesday, East African countries imposed sanctions, including a travel ban and asset freeze on the warlords.
Our correspondent in Mogadishu says the warlords, including sacked minister Mohamed Afrah Qanyare, went further north overnight towards El Bur in the central Somali region of Galgudud.
The past few days saw a steady build up of Islamist militia at a former army training camp just south of the town, and residents of Jowhar have been fleeing, anticipating violence.
Four warlords are still holed up in the north of the capital and are threatening to resist the Union of Islamic Courts - who now control the capital - and their militia.
Our correspondent says the attack on Jowhar from the north came as a surprise, as the Islamic fighters have been camped to the south.
Tactically the north of the town is important, as that is where the airport is based, he says.
The fighting was between the Islamist fighters and those of the remaining alliance militia.
Jowhar's main warlord Mohamed Dhere and his militia were thought to have been involved in the fighting.
There are still no details of casualties, but fighting was reported to be intense.
Meanwhile, the Somali parliament, based in Baidoa because the capital, 250km away, is too dangerous, is debating whether to ask the African Union to send troops into Mogadishu.
On Tuesday, Kenya's Foreign Minister Raphael Tuju said sanctions imposed on the warlords who once controlled Mogadishu would apply immediately as they were still a security threat.
He described the Islamist takeover as a "popular uprising".
"It is obvious that the dislodged warlords still pose a threat to the security of Mogadishu and the country at large," Mr Tuju said.
"In this regard, it is important for Igad member states to support the transitional federal government to assume full control of the capital, Mogadishu, and the country as a whole."
The US says it will form a Somalia Contact Group in New York on Thursday to discuss the situation there.
President Yusuf and some Kenya-based diplomats have criticised the US for supporting the warlords.
The US has neither confirmed nor denied the reports but says it will stop Somalia becoming a safe haven for terrorists.
The transitional government only controls a small part of Somalia, which has not had a functioning national authority for 15 years.
They have had talks with the Union of Islamic Courts, but have fallen out over whether to ask foreign peacekeepers into the country.
Courtesy of: bbc.com