Three columns of troops were moving on Kilinochchi, the headquarters of the Liberation Tigers of Tamil Eelam (LTTE), the ministry said in a statement.
"The fall of Kilinochchi is imminent as the security forces have already entered into the Kilinochchi town perimeter from the northern, southern and western edges," the statement said.
It said troops took a junction just north of Kilinochchi town early Friday after taking another key town a short distance away.
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Army chief Sarath Fonseka said his forces were poised to take control of Kilinochchi shortly as the air force stepped up attacks against pockets of rebel resistance.
There was no immediate comment from the Tigers, but the guerrillas in a statement on Thursday night said another five civilians had been killed and 18 wounded in an air attack.
The guerrillas have vowed to defend their political base after the military announced it intended to capture Kilinochchi and dismantle the de facto state run by the separatist mov