By Isabel Coles and Stephen Kalin

NEAR MOSUL, Iraq (Reuters) - Iraqi security forces on Thursday began the second phase of their offensive against Islamic State militants in Mosul, pushing from three directions into eastern districts where the battle has been deadlocked for nearly a month.

Since the offensive to capture Mosul began 10 weeks ago, U.S.-backed forces have retaken a quarter of the jihadists' last major stronghold in Iraq in the biggest ground operation there since the 2003 U.S.-led invasion that toppled Saddam Hussein.

More than 5,000 soldiers and federal police troops, redeployed from Mosul's southern outskirts, entered half a dozen southeastern districts, while counter-terrorism forces advanced in al-Quds and Karama districts after reinforcements arrived.

Other soldiers pushed simultaneously toward the city's northern limits. U.S. military advisers were seen watching operations as coalition aircraft circled overhead.

"At 0700 this morning, the three fronts began advancing toward the city center. The operation is ongoing today and tomorrow and until we liberate the eastern side of the city completely," Lieutenant General Ali Freiji, who was overseeing army operations in the north, told Reuters.

Iraqi forces have taken around half of the eastern side of Mosul, which is bisected by the Tigris river, but have yet to enter the western side, where 2,000-year-old markets and narrow alleyways are likely to complicate any advance.

The fall of Mosul would probably spell the end for Islamic State's ambition to rule over millions of people in a self-styled caliphate, although the militants would still be capable of waging a traditional insurgency in Iraq, and plotting or inspiring attacks on the West.

A U.S.-led coalition backing the Iraqis said Thursday's operation had opened two new fronts inside Mosul and limited Islamic State's ability to raise fighter numbers, move them or resupply.

The U.S. military later said a coalition air strike that hit a van in the parking lot of a hospital compound on Thursday may have killed civilians, highlighting the challenge of targeting an enemy embedded within the civilian population.

DEEPER U.S. ENGAGEMENT

One elite Iraqi unit encountered sniper and machine gunfire as it advanced alongside federal police in Mosul's Intisar district, an officer said.

A plume of white smoke, likely to be from an air strike, rose from a southeastern district while heavy gunfire was audible on the northern front and a commander there said nine suicide car bombs had been disabled.

State TV said Islamic State defenses were collapsing in the areas of Salam, Intisar, Wahda, Palestine and al-Quds and that fighters' bodies filled the streets there. A military statement later said forces had raised the Iraqi flag in al-Quds.

The government's accounts are difficult to confirm as the authorities have increasingly restricted foreign media's access to the battle fronts and areas retaken from Islamic State in and around Mosul. They have given no reason.

The battle for Mosul involves 100,000 Iraqi troops, members of the Kurdish security forces and Shi'ite militiamen.

U.S. commanders have said in recent weeks that their military advisers will embed more extensively with Iraqi forces.

An army colonel said Iraqi forces had suffered few casualties so far. "The orders from the senior commanders are clear: no halting, no retreat until we reach the fourth bridge and link up with counter-terrorism units," he said.

Coalition forces bombed the last remaining bridge connecting east and west Mosul late on Monday in a bid to block Islamic State's access across the Tigris River.

"The enemy is currently isolated inside the left (eastern) bank of Mosul," military spokesman Yahia Rassol said on state TV. "In the coming days, Iraqi forces will liberate the entire left bank of Mosul and after that we will tackle the right."

TRAPPED CIVILIANS

The United Nations has expressed concern that destroying the bridges could obstruct the evacuation of civilians. As many as 1.5 million are thought to still be inside.

Residents of eastern Mosul reached by phone described fierce clashes that included explosions, air strikes and bombardment by helicopters.

"My family and I cannot leave the room we are sitting in. We have sealed the windows for hours, but in the afternoon the Iraqi forces arrived and we saw them," one al-Quds resident said.

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