Capturing Hinche in central Haiti on Tuesday, the rebel advance caused the neighbouring Dominican Republic to close the border.
Three people, including police chief Jonas Maxime, were killed during the attack on local police stations - 130km northeast of the capital Port-au-Prince.
A town of 87,000 inhabitants, Hinche fell into rebel hands when security forces retreated to the town of Mirebalais, 55km further south.
The attack was led by Louis-Jodel Chamblain, leader of a paramilitary group under former military dictator Raoul Cedras - who ruled the country from 1991-94.
The latest killings pushed the toll since 5 February, when rebels captured the northern city of Gonaives, to more than 55.
Gonaives and its 200,000 inhabitants remain in rebel hands.
Despite violence elsewhere, the streets of Haiti's capital were calm following a Sunday protest against President Jean-Bertrand Aristide's government.
Opposition leaders in the capital reiterated their opposition to violent overthrow of Haiti's government, saying they would resort only to "legal, peaceful" means in its attempt to sweep Aristide from power.
"We affirm our commitment to a peaceful struggle and we will use every peaceful means available to us under the constitution," opposition leader Serge Gilles told journalists.
Haitian rebels have held on to
Gonaives for more than a week
Gilles noted however, that some opposition factions have not renounced violence in their effort to topple Aristide, whose popularity has plummeted after elections in 2000 tainted by fraud charges.
"There are two opposition factions - one committed to the rule of law, which we belong to, and the other violent, which we don't approve of," Gilles said.
The US said it would keep working within multilateral institutions in hopes of bringing a peaceful resolution to the crisis.
"We support the restoration of democratic practices, human rights, and rule of law as called for in the Organization of American States resolutions," said White House spokeswoman Claire Buchan.
"The United States is working with hemispheric partners to address the situation. We are grateful for the efforts of the CARICOM to promote a peaceful resolution," Buchan added, referring to mediation efforts by the 15-nation Caribbean community.