Iraq's army has recaptured a mainly Shia village north of Baghdad, two days after rebels had taken control, a senior commander has told the BBC.
The rebels launched an attack on Saturday, killing at least 14 people and taking control of Duailiyah the next day, local sources said.
Tribal chiefs said 650 villagers had left over the past two days.
Meanwhile, a Sunni Arab bloc has ended its boycott of parliament over the house arrest of its leader.
Maj Gen Saleem Karim, commander of the army's 5th Division, told the BBC his soldiers were now in control of Duailiyah.
Gen Karim said that Iraqi troops had attacked the militants on Monday morning with the support of US helicopters.
He said a number fighters had been detained.
The militants had attacked on Saturday morning with mortar rounds. Local sources suggest rebels from al-Qaeda then stayed in the village.
They torched houses and forced hundreds of families to flee.
Duailiyah is 72km (45 miles) north of Baghdad, in the province of Diyala, the scene of some of the most intense fighting in Iraq in recent months.
Many members of al-Qaeda are believed to have gone to the province after being forced out of their former strongholds in western Anbar province and parts of Baghdad, says the BBC's Crispin Thorold in Baghdad.
Sunnis back in parliament
Also on Monday, Sunni MPs returned to the Iraqi parliament after a two-day boycott.
The leading member of the Sunni block, Adnan al-Dulaimi, who has been at the centre of the row, was also in parliament.
Soldiers had been deployed around his Baghdad house since Friday, after more than 40 of Mr Dulaimi's staff were arrested in a joint Iraqi-US operation.
Security forces say they launched the operation after finding a car bomb in the MP's compound - a claim he denied.
The MP said he was not a sponsor of terrorism. "We are the ones who are subject to terrorism," he said on Friday.
Mr Dulaimi has in the past complained about the operation of Shia militias and death squads. He strongly criticised Shia links with Iran before leaving the government earlier this year.
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