Iraqi forces battling to retake the small town of al-'Ayadiya where militants fleeing Tal Afar have entrenched themselves said on Tuesday the fighting is "multiple times worse" than the battle for Mosul's old city.

Hundreds of battle-hardened fighters were positioned inside most houses and high buildings inside the town, making it difficult for government forces to make any progress, army officers told Reuters.

Iraqi government troops captured the town of Mosul from Islamic State in June, but only after eight months of grinding urban warfare.