The capture of the Handarat camp a few kilometres north of Aleppo marked the first major ground advance of the offensive, which the government announced on Thursday.
Saturday's advance captured the camp for Palestinian refugees on elevated ground overlooking one of the main roads into Aleppo. Handarat had been in rebel hands for years.
"Handarat has fallen," an official with one of the main Aleppo rebel groups told Reuters. An army statement confirming the advance said "large numbers of terrorists" had been killed.
Dozens of terrorists have been reported killed in eastern Aleppo since the army announced the new offensive late on Thursday.
A Syrian military source told Reuters the operation announced late on Thursday was continuing according to plan, but declined to give further details. The source said on Friday the operation could go on for some time.
Asked about the weapons being used, the source said the army was using precise weapons "suitable for the nature of the targets being struck, according to the type of fortifications", such as tunnels and bunkers, and "specifically command centers".
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