Syrian rebels, backed by Turkish warplanes and tanks, captured on Sunday the town of Dabiq from Daesh, which considers it symbolically important, a monitoring group reported.
The advance comes a day after the rebels started a major offensive to take the town in northern Syria near the Turkish border, the Syrian Observatory for Human Rights added.
The rebels are combing the town for remnants of the militants, the Observatory added.
The rebels took control of Dabiq after Daesh fighters were forced to retreat to other areas that are still under the radical group's control on the outskirts of Aleppo in northern Syria, according to the watchdog.
In Daesh's end-of-times vision, Dabiq holds great symbolic value as a site of a key battle between Muslims and a Christian army.
Dabiq is also the name of Daesh's English-language magazine.
In August, Turkey invaded northern Syria to attack Islamic State and Kurdish militants.
In recent weeks, Turkey has turned its focus on the jihadist group after the United States urged Ankara, its NATO ally, to refrain from further attacks on the Kurds.
The reported capture of Dabiq comes ahead of a meeting scheduled for later on Sunday between US Secretary of State John Kerry and European foreign ministers in London to discuss Syria’s conflict.
The diplomats are due to discuss the results of Kerry's Saturday meeting in Switzerland, which included the foreign ministers of Russia, Turkey, Saudi Arabia and Qatar.
The Swiss talks ended inconclusively.
The flurry of diplomacy comes weeks after a ceasefire deal in Syria collapsed and Washington suspended cooperation with Moscow over its continued bombing of Aleppo.
Russian Foreign Minister Sergei Lavrov told Russian media after the talks he had pressed for a "political process" to end the five-year conflict to begin "as soon as possible."
Kerry said they had talked about new ideas for a ceasefire.
Turkey, Saudi Arabia, Qatar, and the US all back various rebel groups in Syria, while Iran and Russia back Syrian regime forces.
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