The Tamil Tigers have not commented on the military's claims and with journalists barred from the conflict zone, they cannot be independently verified. The rebels have come under sustained pressure from the government's air and ground forces, and they have been gradually forced to cede territory in several areas in recent months. The army says Mallavi town is a big commercial hub, and the birthplace of Tamil Tiger leader Velupillai Prabhakaran's wife.
The Lankan defence ministry said the the domination of the well-known Mallavi town is one of the most decisive and impressive phase of the 'war for peace'. The Tamil Tigers have been fighting for a separate homeland in the north and east for 25 years. More than 70,000 people have died in the conflict.
Fighting has intensified in Sri Lanka in recent months as soldiers have advanced, aiming to crush the rebels and win the war which began a generation ago. Tens of thousands of people have fled from the Tiger-controlled areas.