The Islamic militants hoisted their flag above the city's main square, a Reuters correspondent said Monday.

"They have taken over Spinzar chaman, the main city square. Heavy clashes are ongoing between Taliban and government forces," deputy governor of the Kunduz province Hamdullah Danishi told DPA news agency.

The Taliban also broke into the main prison in the city and freed hundreds of Islamist fighters.

Earlier, local police spokesman, Sayed Sarwar Hussaini, told the Associated Press news agency that the Taliban were controlling a number of government buildings in the city, including a hospital and a courthouse.

"Around half the city has fallen into the hands of Taliban insurgents," the official said. "Our forces have not yet received support," he added.

Special Afghan forces from both police and army were headed to Kunduz from neighboring Balkh province to help the defenders, a Balkh police commander said.

At least 35 Taliban militants were killed in the fighting, according to the defense ministry.

Looking for the wounded

Taliban fighters launched a three-pronged attack on Kunduz early on Monday morning, their third attempt this year to take the strategic town.

"The Taliban has taken over our neighborhood, which is part of Kunduz city, I can see their fighters all around," an AFP journalist said.

Taliban spokesman Zabihullah Mujahid urged Kunduz residents to stay inside.

"The mujahedeen are trying to avoid any harm to Kunduz residents," he said on his official Twitter account, referring to Taliban fighters.

A Kunduz hospital official confirmed the Taliban had entered the hospital, apparently looking for wounded government fighters.

"They just visited our rooms. They didn't harm anybody and didn't damage anything. They left soon after," said the official, who declined to be identified.

'Choking' the security forces

Kunduz is situated around 150 miles (250 kilometres) north of the capital Kabul. The Islamist were pushed out of city by NATO forces during the 2001 invasion of Afghanistan, but managed to keep control over parts of the surrounding countryside.

"It is certainly the first major breach of a provincial capital since 2001," said Graeme Smith, senior analyst for International Crisis Group.

"They are choking the Afghan forces from all sides. It looks pretty grim," he added.

Fighting on their own

The province is at a strategic crossroads connecting the four points of Afghanistan, and the capture of its capital would be a major milestone in the Taliban's nearly 14-year insurgency.

German soldiers were stationed in the area until late 2013, as part of the coalition force.

Afghan security forces have been left mostly on their own since the NATO withdrawal last year, although a smaller mission has remained to train and advise them, while US drone attacks still target militant leaders. An American counter-terrorist force is also deployed in the country.

dj/kms (AP, AFP, Reuters, dpa)