Syrian government forces took two villages in the southern province of Daraa overnight, a monitor and state media said on Tuesday, cutting off a pocket of rebel-held territory.
The move means the northeastern part of the U-shaped piece of land the rebels hold is completely surrounded by government forces.
The Syrian Observatory for Human Rights said government forces took control of the villages of Basr al-Harir and Mlehat al-Atash in an overnight operation.
"The regime achieved its most significant advance since last Tuesday" when it ramped up its bombardment of rebel positions in Daraa, the Observatory said.
A military source cited by state television confirmed the army had seized both Basr al-Harir and Mlehat al-Atash.
For the government, the latest push means its forces in the heart of Daraa province and those in adjacent Sweida province are now directly connected.
The Britain-based Observatory said at least 15 rebels were killed in the latest battle, their bloodiest day since the government began ramping up its operations.
A total of 29 rebels and 24 pro-government fighters have been killed so far. At least 32 civilians have also lost their lives, the Observatory said.
The government and its allies earlier this year retook the last pockets in and around Damascus that had remained under rebel or jihadist control.
It had long stressed it would expand operations to recover the territory it lost after the war began in 2011, and Daraa is next on the list.
Rebel forces also control part of the neighbouring province of Quneitra. Both provinces abut the armistice line with Israeli forces in the annexed Golan Heights.
The United Nations warned that up to 750,000 people were at risk as a result of the week-old offensive.
Neighbouring Jordan, which already has the world's second hightest ratio of refugees per capita after Lebanon, has warned it can not take in another mass influx from Syria.
The government has started bombarding the city of Daraa but Russia is leading negotiations with Syria, Jordan, Israel and the United States on a settlement to avoid a bloody onslaught on the provincial capital.
Smoke rises above a rebel-held area of Daraa province following a Syrian government air strike on June 25, 2018
A Syrian family flees fighting in the southern province of Daraa on June 21, 2018, among the thousands of civilians who have fled a government offensive that threatens to trigger a new refugee crisis for the region