The liberation was achieved after the forces seized several strategic locations over the past few days under the cover of US airstrikes.
Mokhtar Khalifa, the Sirte mayor, told The Associated Press that the city’s southern and western sections are under control of the Libyan fighters loyal to the UN-brokered government in Tripoli, the country’s capital.
"Sirte is 70 percent free, it will soon be completely free," Khalifa said.
Libyan pro-government forces have lost hundreds of fighters since the Sirte offensive started.
ISIS seized Sirte, the hometown of Libya's former dictator Moammar Gadhafi, in 2015 and Libyan pro-government forces launched an operation to retake it in June.
After an initial push into Sirte, the advance stalled.
The city's coastline and the Ouagadougou proved the biggest challenge because of ISIS snipers positioned on rooftops, roadside bombs planted along the streets and ISIS suicide bombers.
Upon the Tripoli government's request, US warplanes carried out a series of airstrikes targeting ISIS positions in Sirte starting 1 August, breaking the stalemate.
President Barack Obama said earlier that the strikes, which he authorized, would continue as long as necessary to make sure the militant group doesn't get "a stronghold in Libya."
"The international support has made a big difference" in the battle against ISIS in Sirte, Khalifa said.
On Wednesday, the Libyan fighters, mainly from the western city of Misrata, captured the sprawling convention center, which ISIS had turned into its headquarters.
The fighters took down the black ISIS banners, replacing them with the Libyan tricolor flag, said Reda Eissa, a media official.
Libya descended into chaos following Gadhafi's overthrow in 2011.
The country has been split between rival parliaments and governments, based in Tripoli and the country's Far East, each backed by an array of militias and tribes.
In December last year, the United Nations struck a deal with Libya's rival factions to create the unity government led by Fayez Serraj.
He still needs a crucial vote of confidence from the internationally-recognized parliament, based in eastern Libya.
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