The paramilitary Rapid Support Forces (RSF) has seized control of Sudan's second largest city, Nyala, from the army after months of fighting, several sources have told the BBC.
One eyewitness said residents were celebrating because they hoped it meant an end to the violence.
The fighting has forced more than 670,000 people to flee their homes.
The city's hospitals have been destroyed, and bodies are said to be lining the streets.
This major advance for the RSF comes as the two warring sides were set to resume peace talks in Saudi Arabia.
The army has not commented on its defeat in Nyala.
Nyala, capital of South Darfur state, is a strategic city connecting Sudan with Central African Republic (CAR).
The RSF originated in Darfur and has been accused of atrocities against non-Arabic groups in the region during this year's conflict.
High-ranking army generals, including the head of the military in Nyala, were killed in battle a few weeks ago.
RSF's second-in-command Abdulrahim Daglo, who was sanctioned by the US for his alleged role in ethnic cleansing in West Darfur, led the capture of Nyala.
Eyewitnesses have reported that RSF fighters have been looting and storming civilian houses since they seized the city.
EMERGENCY, a medical organisation that provides treatment to victims of war, says its Sudanese staff members were taken from a paediatric centre in Nyala and arrested by the RSF.
In June the RSF captured Um-Dafog, a small town on the border with CAR which is believed to be a key area for their supply chain.
The United Arab Emirates (UAE) has been accused of supplying weapons to the RSF through CAR and Chad's Um-Dafog. It has denied the accusations.