According to the Iraqi state TV, army and police forces fully seized control of the Daesh-held district and raised the Iraqi flag there.
Hammal al-Alil was the last Daesh stronghold, about 30 kilometers south of Mosul.
Earlier Saturday, Abdulamir Rashid Yarullah, head of the army's Nineveh Operations Command, said Iraqi troops had seized control of several districts south of Mosul.
Last month, the Iraqi army -- backed by U.S.-led coalition airstrikes -- launched a wide-ranging operation aimed at retaking Mosul, the last Daesh bastion in northern Iraq, from the terrorist group.
In mid-2014, Daesh captured Mosul, Iraq’s second largest city, before overrunning vast swathes of territory in the country’s north and west.
Recent months have seen the Iraqi army, backed by local allies on the ground and the U.S.-led air coalition, retake much territory.