Kurdish Peshmerga forces were within eight kilometres of Mosul on Sunday, after days of fighting and sweeping territorial gains in the operation to free the key Iraqi city from the control of Islamic State (IS), a report said.

Entering Mosul is likely to kick off intense street fighting, the CNN report quoted officials as saying.

Two Peshmerga factions linked up after surrounding the empty town of Bashiqa, about eight miles east of Mosul, with the support of coalition air power, the Peshmerga's general command said in a statement Sunday.

They were able to cordon off eight villages in an area measuring about 100 sq km and secure a significant stretch of the Bashiqa-Mosul highway to limit Islamic State’s freedom of movement, commanders said. Hourslong clashes left dozens of ISIS militants dead, they said.

Turkish troops supported the Peshmerga in the battle, and Turkey has provided them with artillery, tanks and Firtina howitzer vehicles, Prime Minister Binali Yildirim said, according to state-run news agency Anadolu.

Islamic State executed about 40 people who were celebrating the apparent liberation of their villages by Iraqi forces, a Mosul City Council official said Sunday, citing local sources.