Pro-Assad forces are poised to cut off rebel supply lines and end nearly two years of insurrection in the ruined city

High spring in Syria's largest city and the final battle has arrived. From his vantage point on a frontline in Aleppo's northeast, Abu Bilal, a rebel commander, had spent the past month staring at a ridge line about a mile away that marked the closest Syrian military position.

A large white house, the one building still standing, had been the target for the only tank his men had. It shimmered in the rising heat and, at times, figures seemed to appear briefly in the distant haze. Were they really there?

There was nothing illusory about the Syrian soldiers and tanks that appeared last Thursday, though. Just after dawn, the ridge and the cobalt sky erupted with an intensity that Bilal and his unit had not seen in the two-year fight for Aleppo.

After surging to life, then stalling so often, the battle they had been braced for – and possibly a definitive reckoning on who will prevail in Syria's war – was upon the rebels defending the Sheikh Najjar area. The district's factories and mills had long been an engine room of Syria's economy. Now they are crucial to its destiny.

"They are trying to encircle the city," said one rebel leader from a room in a pock-marked house. "And this time they think they can do it."

Later that day, the worst fears of the opposition fighters were about to be realised. Just to their north, the Aleppo central prison, seen by both sides as a vital target, had been breached by regime soldiers, fighting with a battalion of Iraqi Shia irregulars. Gaining control of the prison would allow government forces to start to close the gap between the north-east of the city and their stronghold in the north-west.

Such a move would further compromise the rebels' already vulnerable supply lines and make their campaign to hold Aleppo close to impossible.

Inside the ancient city – one of the oldest continuously inhabited urban centres in the world – the strains are already showing. Next to nothing moves here. Throughout almost two years of chaos and insurrection, residents who remained in the rebel-held east took to the streets during meal times. They drove their cars, walked to mosques, shopped in markets in between bombing raids. Not any more.

Aleppo is eerie and abandoned. Its streets seem cleaner and better-kept than before, mainly because there are so few residents left. The only messes to clean up are caused by regular bombing raids by Syrian planes and helicopters, which destroy homes and buildings with unmitigated savagery. In some districts near the eastern fringes, up to 30% of all buildings have been demolished. Whole neighbourhoods have been emptied, or are down to their last hardy souls, many of whom have no option but to stay.

Abu Mahmoud was at the mosque when a barrel bomb destroyed half of his house in the Shaar district in February. He spent the rest of the winter living in the other half, exposed to the elements and still-constant menace from the skies. He says he expects to die there.

"What am I going to do?" he asked plaintively, offering tea in china cups salvaged from the ruins. "This has become a war that is far bigger than any of us. The country is being destroyed, and the region is being sucked into a hole from which it can never recover.

"This could have all been avoided if people spoke to each other from the beginning, if leaders acknowledged that the people have the right to expect things from them."

Further east, towards Aleppo's airport, which was taken back by regime forces this year, Hamid Mahmoud and his extended family were moving back into their home. A group of young girls were hosing out a courtyard – the mains water had been turned back on earlier in the week, one of few mercies in this unforgiving war. In one room, older women were tending a stove. And in the only other room, six men were sitting silently in the gloom.

"Four days ago my wife was killed," said Mahmoud. "We had moved to Bustan al-Basha [another suburb of east Aleppo] and a barrel bomb hit our house. It was 10 at night and I dragged her body out of the bricks. He stares silently ahead, tears welling as he describes how two badly wounded girls were rescued by neighbours. Both have been taken to a hospital in Turkey.

Other men, brothers and cousins, reach for the mobile phones they had used to record the aftermath of the bombing, a jumbled swirl of smoke, screaming and sirens that all those who remain in Aleppo seem all too familiar with now.

About two miles further away, the Syrian military and its backers lurk. "They are Lebanese and Iraqis," said a rebel fighter. "They speak harsh words to us on the radios – they're always talking about [Shia] Imams Ali, Hussein and Abbas. And when they try to advance, they fly their flags."

The ever-rising sectarian dimension to Syria's war, and to the insurgency plaguing Iraq, is lost on Mahmoud, his brothers and cousins, who say they never imagined cowering in fear in their homes almost two years after the opposition entered Aleppo.

"I thought this would be over in a few months. It's unbelievable that things have got to this point and terrifying to know that they will likely get worse. We thought getting rid of al-Qaida [Isis] would be the beginning of the end."

The fight to oust Isis, a virulent and ultra-fundamental jihadist group, was a defining three months in the battle for Aleppo, but for the wrong reasons, as rebel groups who led the fight have discovered.

"We lost 550 men," said a senior member of the Liwa al-Tawheed, the largest opposition group in the Islamic Front, one of two rebel military blocs in northern Syria. "The Islamic Front lost 2,500. We did that because we needed to. They did not represent us. And we were told that if we kicked them out it would be easier for others to help us. Well, we did that, and look at things now."

Towards the centre of the city, the former Isis base, in a hospital just east of the citadel, stood unmolested by Syrian jets, just as it had throughout the war. The Tawheed base next door was in ruins.

The rotors of a helicopter whumped way overhead, flying so high that no one could see it. Within minutes a jet fighter roared, also well out of range of anti-aircraft missiles, even if the rebels on the ground had them.

By the week's end, the battle for Sheikh Najjar – and for Aleppo – was intensifying. Rebel reinforcements were steadily making their way to Abu Bilal's position and the ridge opposite was teeming with Syrian troops, who were creeping ever closer to the main rat run into Aleppo.

"After all this, we are not going to lose," said a fighter who worked with Abu Bilal.

Asked how he and those fighting with him were going to win, he shrugged and offered: "We know we are fighting for a good cause. Victory comes slowly, and in strange ways."