Yemeni forces have killed at least 35 al-Qaeda fighters in the southern part of the country, the defence ministry said.
The ministry said the Yemeni military took control of Wadi Banaa Arab, near the town of Jaar, after it launched a wide-scale on an al-Qaeda stronghold in the area.
Thursday's attack came after al-Qaeda claimed responsibility for a suicide bombing on Monday at a military parade rehearsal in the capital, Sana'a, and killed 100 Yemeni soldiers.
According to Yemeni state media, funerals were held on Thursday for 67 of the slain soldiers.
Militants affiliated with al-Qaeda have strengthened their foothold in Yemen, taking advantage of a year of political turmoil and a weak central government in the impoverished Arabian Peninsula country.
Yemeni troops are fighting opposition fighers in southern cities, as the government presses ahead with a US-backed offensive to help stabilise the impoverished Arab state.
Yemeni warplanes also launched strikes on Jaar, but no casualties have been reported, residents said.
Western and Gulf Arab countries have watched with mounting alarm as a political crisis in Yemen has given al-Qaeda the opportunity to develop a base from which to launch attacks around the world.
Fighters in the south exploited mass protests last year against former President Ali Abdullah Saleh to seize large swathes of territory.
In the strategically important city of Zinjibar, Islamist fighters on Thursday launched a counter-attack against government forces from the eastern parts of the city but were pushed back, a local army official said. One soldier was wounded in the fighting.
The Yemeni army recaptured parts of the southern city of Zinjibar on Wednesday.
The advance of troops into the centre and northern neighbourhoods of Zinjibar, the capital of Abyan province, represents a new front in the government's offensive to reclaim areas seized by insurgents in the south.
Washington has stepped up drone attacks in Yemen since President Abd-Rabbu Mansour Hadi took office in February, and the Pentagon said it had recently resumed sending military trainers to the Arab state.
The United States and Saudi Arabia have come to regard Yemen-based al Qaeda in the Arabian Peninsula, known as AQAP, as the network's most dangerous wing.
Early in May, Washington said Western and Arab intelligence agencies had foiled a plot to arm a suicide bomber with an improved version of an underwear bomb that failed to explode on a 2009 US-bound flight.