DIABALY, Mali: French and Malian troops recaptured the key towns of Diabaly and Douentza on Monday from Islamist rebels holding Mali's north, as tens of thousands of people fled from the fighting into the desert and bush.

The inroads marked a significant advance in the 11-day offensive led by former colonial power France, whose aim is the "total reconquest" of Mali's vast semi-arid north, comprising over half the West African country's territory.

France's defence ministry said Malian troops backed by French soldiers retook the two towns in a "definite military victory."

While international support has been high for the UN-backed offensive amid concerns the vast and sparsely-populated zone could become a new Aghanistan-like terrorist haven, Egyptian President Mohammad Morsi on Monday condemned the move.

"We do not accept at all the military intervention in Mali because that will fuel conflict in the region," Morsi said.

But in Diabaly local residents emerged from their shacks applauding wildly as a convoy of about 30 armoured vehicles with some 200 Malian and French troops moved into the town on Monday morning.

Some shouted "Long Live France!" as the troops rolled in and others scrambled to photograph the "liberators" on their cellphones.

French military officials and local residents both said the fleeing Islamists had riddled the town with landmines.

"There is a problem with unexploded ammunition," said Lieutenant-Colonel Frederic, in charge of the operations in Diabaly who identified himself by only his Christian name in line with French army policy.

Diabaly, which lies 400 kilometres (250 miles) north of the capital Bamako, has been the theatre of air strikes and fighting since it was seized by Islamists a week ago.

French Defence Minister Jean-Yves Le Drian said the town of Douentza, which had been under Islamist control since September had also been retaken by French and Malian troops.

Douentza is a strategic crossroads town some 100 kilometres (60 miles) east of Konna, whose capture earlier this month by extremists saw the French army swoop to the aid of the crippled and weak Malian army.

The push into the government-held southern triangle of the bow-tie shaped nation was seen as a threat on Bamako.

French and Malian forces forged ahead with their offensive despite threats of further retaliation from jihadists after a stunning hostage attack at a gas plant in neighbouring Algeria which ended Saturday with the deaths of 37 foreigners.

The Internal Displacement Monitoring Centre voiced concern for fleeing citizens who it said faced atrocities such as rape, abductions and killings in Mali.

"Over the last few days, internally displaced people in the north of the country have reportedly been fleeing into the desert and bush, with dire consequences for their security and access to shelter, food, water and health care," said the IDMC, an organisation that works with the United Nations to track population movements.

The UN refugee agency has warned the fresh wave of fighting could drive another 700,000 from their homes in coming months, bringing the number of displaced since the start of the crisis to over a million.

The European Union offered to host a global meeting on Mali in Brussels on February 5, involving the African Union and the Economic Community of West African States regional bloc.

British Prime Minister David Cameron said his country will use its chairmanship of the Group of Eight richest nations to focus on the "evolving" threat of terrorism in north Africa.

Meanwhile the planned deployment of around 6,000 African soldiers continued slowly into Bamako. The UN-approved African-led force is hampered by cash and logistical constraints, requiring up to 200 million euros ($265 million).

Mali's crisis first erupted when the nomadic Tuaregs, who have long felt marginalised by government, launched a rebellion a year ago and inflicted such humiliation on the Malian army that it triggered a military coup in Bamako in March.

The Tuaregs allied with Islamist groups including Al-Qaeda in the Islamic Maghreb (AQIM) and seized control of huge swathes of territory including the main towns of Gao, Kidal and fabled Timbuktu.

The Islamists soon chased out their Tuareg allies and began to run territories under their control like a particularly brutal medieval emirate and imposed a harsh form of sharia law.