About 1,000 men, women and children left the area still under the control of the rebels on Wednesday to seek shelter with government forces, the ministry said.
It said 650 people had escaped by boat while the others walked through the jungle to reach troops in the coastal district of Mullaittivu where the Liberation Tigers of Tamil Eelam (LTTE) guerrillas have been cornered.
"These civilians have revealed the continuation of forcible child recruitment by the LTTE for battle purposes and brutal killings of individuals and families who defy their orders," the ministry said.
Sri Lanka's government says nearly 40,000 people have left the conflict zone and sought shelter in military-held areas.
The country's military accuses the Tigers of using the civilians as cover, but the UN has said both sides could be guilty of war crimes and crimes against humanity.
The defence ministry said government troops killed another 31 Tiger rebels in separate clashes in Mullaittivu district on