Kurdish and Iraqi government forces have taken control of the Mosul dam from the Islamic State group, after days of fighting aided by multiple air strikes from US jets and drones.
Barack Obama, the US president, announced the "major step forward" to Americans on Monday night, and hailed co-operation between the government and Kurdish forces as an example of how to combat the Islamic State.
He also pledged a long-term US mission to defeat the group.
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The advance of the Kurdish fighters and about 120 Iraqi soldiers has been aided by continuous US air strikes. US aircraft have carried out 35 strikes against Islamic State targets over the past three days, destroying more than 90 targets, the Pentagon said on Monday.
Drones and fighter, bomber and attack jets "eliminated" fighters' positions in the battle for the dam, Pentagon spokesman Rear Admiral John Kirby said.
"In all, we destroyed over 90 targets including a range of vehicles, equipment and fighting positions," he added in a statement.
"Iraqi forces have cleared the dam and are working to further expand their area of control."
The recapture of the entire Mosul dam complex on the Tigris river and the territory surrounding its reservoir would be a significant victory against the Islamic State group, which seized large swaths of northern and western Iraq this summer.
Al Jazeera's Zeina Khodr, reporting from east of Mosul, said that while some Iraqi government forces were involved in the operation, their number was felt by the Peshmerga to be "insignificant".
She added: "Peshmerga commanders tell us that they have no intention of pushing towards the stronghold of the Islamic state group. They would be ready to do so - only if there is an agreement among Iraq's communities."
The Iraqi army launched an operation on Tuesday to drive the Islamic State fighters out of Tikrit, which is the hometown of former president Saddam Hussein.
Our correspondent reported that the Iraqi army is trying to advance to the provincial capital of Salahadin and that there were heavy clashes taking place 10 kilometres southwest of Tikrit.
In his address Obama repeated his support for new Iraqi Prime Minister Haidar al-Abadi's attempts to form a more inclusive government, but warned he must act quickly to undercut support for the radicals.
"I was impressed in my conversation with him about his vision for an inclusive government but they've got to get this done because the wolf's at the door," he told reporters.
"In order for them to be credible with the Iraqi people, they're going to have to put behind some of the old practices and actually create a credible united government.
"Our goal is to have effective partners on the ground. And if we have effective partners on the ground, mission creep is much less likely," promising a joint "counter-terrorism" strategy with Iraq and US allies.
The Islamic State meanwhile said it would retaliate against the US. In an online video statement, reported by the Reuters news agency, the group said it would attack Americans "in any place" and that it would "drown all of you in blood".
Source: Al Jazeera and agencies