US-backed Iraqi forces announced Thursday they have retaken one of Islamic State's remaining strongholds after hundreds of militants surrendered amid fresh signs the terror group is collapsing and unable to defend its territory.

'They're giving up,' said Lieutenant General Paul Funk, who commands the coalition task force fighting Islamic State in Iraq and Syria. 'Their leaders are abandoning them.'

In uncommon scenes, large groups of militants were turning themselves over to Kurdish Peshmerga forces, in the city southwest of Kirkuk.

The fall of Hawija in northern Iraq, after two weeks of fighting, is the latest in a string of defeats for Islamic State, also known as ISIS, and suggests the rank-and-file fighters are demoralised

Kurdish Peshmerga forces detain Islamic State militants southwest of Kirkuk on October 5 2017

Fighters from the Hashed al-Shaabi, also known as Popular Mobilisation Units, backing the Iraqi forces, in Hawija on October 5 2017

Fighters from the Hashed al-Shaabi pose in front of a defaced mural that depicts the emblem of Islamic State

The fall of Hawija in northern Iraq, after two weeks of fighting, is the latest in a string of defeats for Islamic State, also known as ISIS, and suggests the rank-and-file fighters are demoralised as the group struggles to defend what remains of the territory it seized in 2014.

'The speed at which the enemy gave up surprised me,' Funk said in a phone interview from Baghdad, after Iraqi Prime Minister Haider al-Abadi announced the liberation of Hawija.

Funk said about 1,000 militants surrendered in the past three or four days of fighting in Hawija. The coalition had estimated up to 1,500 militants were defending the city when the offensive began.

Lieutenant General Paul Funk, who commands the coalition task force fighting Islamic State in Iraq and Syria, has said he was surprised by the speed at which the enemy gave up

About 1,000 militants surrendered in the past three or four days of fighting in Hawija, according to the US military

Islamic State built its fierce reputation partly on the willingness of hardcore militants to fight to the last man

In July, Iraq announced that Mosul, the country's second-largest city, was retaken from ISIS after about nine months of intense fighting. Since that decisive battle, the pace of Islamic State's decline seems to have quickened.

US-backed forces in Syria have recaptured about three-quarters of Raqqa, the ISIS headquarters, after about four months of fighting in the city.

ISIS' fierce reputation rested partly on the willingness of hardcore militants to fight to the last man, and the militants rarely surrendered.

But many of the fanatical foreign fighters who initially provided the leadership have been killed and those remaining on the battlefield are conscripts, who often lack the will to fight.

Lieutenant General Paul Funk, who commands the coalition task force fighting Islamic State in Iraq and Syria, says ISIS fighters have been abandoned by their leaders

Last week ISIS leader, Abu Bakr al-Baghdadi released an audio exhorting his fighters to continue the battle

Lieutenant General Paul Funk has said Abu Bakr al-Baghdadi's efforts to persuade his men to continue fighting aren't working

The day after Abu Bakr al-Baghdadi released the audio exhorting his fighters to continue the battle several hundred fighters surrendered

Lieutenant General Paul Funk says Islamic State fighters that have surrendered have complained that they haven't been fed or paid

'They're coming out with their hands up, putting their weapons down – full scale surrender,' Funk said. 'It's a growing trend.'

'What we are hearing (from those who surrendered) is, 'Our leaders have abandoned us, we haven't been fed, we haven't been paid,' Funk said.

Last week ISIS leader, Abu Bakr al-Baghdadi released an audio exhorting his fighters to continue the battle. 'I don't think he's having much of an effect,' Funk said. The day after the audio was released, several hundred fighters surrendered.

Fighters who surrendered or are captured are held by Iraqi or Kurdish forces.

ISIS swept into Iraq from Syria in 2014, capturing large swaths of territory. From a mosque in Mosul, al-Baghdadi announced the establishment of the group's so-called caliphate.

Today, as few as 3,000 militants might remain in Iraq in Syria, down from estimates up to 30,000, though officials caution that the numbers aren't a good measure of the group's strength.

Fighters who surrendered or are captured are held by Iraqi or Kurdish forces

Today, as few as 3,000 militants might remain in Iraq in Syria, down from estimates up to 30,000, though officials caution that the numbers aren't a good measure of the group's strength

ISIS militants still control a string of towns and villages stretching along the Euphrates River in Iraq and Syria, where they are expected to make a last stand

Though Islamic State's numbers have been depleted officials have warned that it may still prove to be resilient, regenerating leaders and conscripting or recruiting new waves of fighters

Terror groups like Islamic State have proven resilient, regenerating leaders and conscripting or recruiting new waves of fighters.

Coalition officials said the fight is not over, despite the progress. ISIS militants still control a string of towns and villages stretching along the Euphrates River in Iraq and Syria, where they are expected to make a last stand.

'It won't be easy and won't be quick,' Funk said.

The victory in Hawija came as Baghdad and Iraq's Kurdish region remain in a political deadlock following a controversial Kurdish independence referendum. But on the battlefield Iraqi and Kurdish forces continue to collaborate, squeezing the jihadis who once controlled nearly a third of the country.

Iraqi forces, backed by fighters from the Hashed al-Shaabi, retook Hawija, one of the Islamic State group's last two enclaves in the country, on October 5

Iraqi forces overran the longtime insurgent bastion of Hawija after a two-week offensive

Abadi made the declaration on Thursday at a news conference in Paris with French President Emmanuel Macron, who has offered to help mediate between Iraq's government and the autonomous Kurdish region, which voted for independence last week.

'I want to announce the liberation of the city of Hawija today,' Abadi said, calling it a 'victory not just for Iraq but for the whole world.'

Still, Abadi's government is struggling to contain the fallout from the independence vote, which, while not binding or expected to lead to the formation of a Kurdish state anytime soon, was rejected as illegal by the Baghdad government as well as neighboring Turkey and Iran.

Iraq's central government has imposed a flight ban on the Kurdish region, while Turkey and Iran have sent troops to the land-locked region's borders to signal their opposition to any redrawing of the map.

Turkish President Recep Tayyip Erdogan on Thursday appeared to threaten a blockade of the Kurdish region, saying: 'All airspace will be closed, flights have already been banned. ... Soon the borders will be closed too.'