Fall of ancient city, also known as Tadmur, opens way for armed group to advance towards key government-held areas.
Fighters from the Islamic State of Iraq and the Levant (ISIL) have taken full control of Syria's ancient city of Palmyra, according to activists and a monitoring group.
The Syrian army has collapsed and ISIL has taken over the city, also known as Tadmur, the UK-based Syrian Observatory for Human Rights reported.
The monitor reported earlier on Wednesday that ISIL had advanced into Palmyra.
Located in central Homs province, the city lies 210km northeast of Damascus in desert that stretches to the Iraqi frontier to the east.
The fall of the city potentially opens the way for ISIL to advance towards key government-held areas, including the capital and Homs.
Deadly clashes had raged overnight between the Syrian government and ISIL, with troops firing rockets from outside Palmyra in an attempt to block ISIL's offensive.
ISIL launched an attack on Palmyra last week, causing material damage to residential areas while clashes left many dead and injured.
They managed to capture two gas fields, leaving hundreds dead.
Abo Muaz, an activist in Palmyra, confirmed to Al Jazeera that ISIL had taken the entire city.
The Syrian army has retreated, ISIL are infested in almost all of the city. The army began its retreat almost two hours ago," he said.
"We do not hear any clashes taking place, either.
"A large number of families are currently fleeing from several parts of Palmyra. Clashes have been taking place and regime warplanes have not stopped bombing the city."
Palmyra dates back to the 1st and 2nd century and has been listed as a World Heritage site because of its architecture, and is also known as The Pearl of the Desert.
Mamoun Abdulkarim, Syria's antiquities chief, has called on the Syrian army, opposition and the international community to save Palmyra.
Hundreds of statues and ancient artefacts from Palmyra's museum have already been transferred out of the city, according to Abdulkarim.