Islamic State militants are reported to have regained control of a town near their northern Syrian stronghold of Raqqa from Kurdish-led forces.
The Syrian Observatory for Human Rights, a UK-based monitoring group, said jihadists overran Ain Issa and nearby villages before noon on Monday.
But a spokesman for the Kurdish Popular Protection Units (YPG) said it was still resisting the IS assault.
YPG fighters and allied Syrian rebels only seized Ain Issa two weeks ago.
The town, only 50km (30 miles) north of Raqqa, is situated at an intersection of the main roads from the de facto of the caliphate proclaimed by IS to other areas it controls in Aleppo province, to the west, and Hassakeh province, to the east.
In recent weeks, IS has launched several deadly counter-attacks against the Kurds.
The jihadist group had until then suffered a series of defeats in areas along the Turkish border since being forced to withdraw from the town of Kobane in January.
The Syrian Observatory said IS militants had retaken full control of Ain Issa and the surrounding area on Monday as part of large-scale offensive in both Raqqa and Hassakeh provinces.
Dozens of YPG and rebel fighters had been killed and wounded, the group added.
IS-associated media outlets also described Ain Issa as “liberated” on Tuesday.
Although YPG spokesman Redur Khalil told the AFP news agency that IS fighters had “managed to enter Ain Issa” after launching an attack at dawn, he insisted clashes were “continuing inside the town in the southern part to expel IS”.
The IS operation follows heavy US-led coalition air strikes against the group in Raqqa. US officials said the strikes were some of the most intense to date. Seven bridges were destroyed, according to the Syrian Observatory.
In a separate development on Monday, IS posted a video online showing the killing of two activists who had been providing information on conditions in Raqqa.
The video shows the two men – identified as Bashir Abdul Azim al-Salem, 20, and Faisal Hussein al-Habib, 21 – being interrogated, then tied to a tree and shot.
A network of activists has been trying to keep the world informed on how IS runs the city where it has imposed its extreme interpretation of Islamic law, and journalists, gay men and anyone seen as hostile to the group have been killed.