WASHINGTON (AFP) - US-backed forces have penetrated the heavily fortified heart of militant bastion Raqa for the first time, in a key milestone in the war against the Islamic State group in Syria.

Air strikes by the US-led coalition battling Islamic State in Iraq and Syria (ISIS) punched two holes in the medieval wall surrounding Raqa's Old City, allowing fighters of the Syrian Democratic Forces to breach the jihadists' defences, Washington and the SDF said on Tuesday (July 4).

The advance - the culmination of a nearly eight-month campaign - comes as the extremists face an expected defeat within days in Iraq's second city Mosul, the other pivot of the cross-border "caliphate" they declared in 2014.

Coalition officials said a few hundred diehard militants were making a desperate last stand in just one square kilometre of Mosul's Old City.

In neighbouring Syria, the SDF said coalition warplanes opened up two breaches in the 2.5km Rafiqah Wall around Raqa's Old City, enabling its fighters to evade explosives laid by ISIS

"Daesh (ISIS) have used this archaeological wall to launch attacks, and planted bombs and mines in its gates to hinder the advance of SDF forces," the alliance said.

During three years of militant rule, Raqa became infamous as the scene of some of ISIS' worst atrocities, including public beheadings, and is thought to have been a hub for planning attacks overseas.

"There have been fierce clashes (in the Old City) since dawn today, with 200 of our fighters mobilising to the area," said Mohammad Khaled Shaker, a spokesman for the Syrian Elite Forces, US-backed Arab fighters allied with the SDF.

The Syrian Observatory for Human Rights said US-backed forces "are clashing with ISIS at four points in the eastern part of the Old City" as fresh coalition air strikes pummelled other neighbourhoods.

'REAL FIGHT HAS BEGUN'

The US envoy to the coalition, Brett McGurk, said on Twitter that breaching the Rafiqah Wall marked a "key milestone in (the) campaign to liberate the city."

US Central Command, which oversees military operations across the Middle East, said the coalition air strike had allowed advancing forces "to breach the Old City at locations of their choosing."

This prevented ISIS from using booby-traps, landmines and suicide car bombs, "protected SDF and civilian lives, and preserved the integrity of the greatest portion of the wall," it said.

The United Nations has raised concerns for tens of thousands of civilians trapped in Raqa, where it says the militants are using many as human shields.

The Rafiqah Wall that surrounds the city's historic heart originally dates back to the late eighth century, when as capital of the Abbasid caliphate, Raqa was briefly the centre of the Islamic world.

The Syrian Observatory for Human Rights said the advance had been supported by US special forces and constituted the "most important progress" yet for the SDF, which broke into Raqqa on June 6.

But ISIS still controls 70 per cent of the city, according to the Observatory, and the toughest battles are yet to come.

"Today, the real fight for Raqqa has begun. There are both many civilians and many mines in the Old City," said Observatory chief Rami Abdel Rahman.

"The biggest challenge for the SDF will be opening up humanitarian corridors so besieged civilians can leave," he said.

Activists were also concerned that as the SDF moved closer to the heart of Raqqa, civilian casualties would rise.

"Now that they are in the Old City, they're in a much more densely populated area," said Hussam Eesa from the Raqqa is Being Slaughtered Silently activist collective.

"We may be counting casualties by the hundreds," he told AFP.

MOSUL VICTORY 'IN TWO DAYS'

The coalition estimates that around 2,500 ISIS militants are defending Raqqa.

That is far more than the 200 or so ISIS fighters, most of them foreign, that Iraqi commanders believe are holed up in Mosul's Old City.

Iraqi forces were moving in on the last ISIS-controlled neighbourhoods of the Old City from all sides on Tuesday, commanders said.

"In the next two days, we will announce the complete liberation of the Old City, and therefore... the city of Mosul," Staff Brigadier General Haidar al-Obeidi, a commander in the elite Counter-Terrorism Service, told AFP.

Iraqi forces have been closing in on Mosul's Old City for months, but its maze of narrow alleyways combined with a large civilian population has made for an extremely difficult fight.

Iraqi forces are facing a rising number of suicide attacks, including some by female bombers, in the final stages of the more than eight-month-long campaign, commanders said.

But coalition officials said the jihadists were now on their last legs in their two most emblematic strongholds.

"#ISIS terrorists down to less than one square kilometre in #Mosul and totally surrounded in # Raqqa," tweeted US envoy McGurk.