The head of a prominent civil society group in the region confirmed the town of Toulepleu was under the insurgents' control, The New York Times reported.
There also was more looting and burning in the capital, Abidjan, that targeted the homes of ministers aligned with Alassane Ouattara, the politician who has gained international recognition as the winner of Ivory Coast's presidential election last November but who has been unable to take office because incumbent Laurent Gbagbo contends the results are tainted and refuses to leave.
The Times said militant youths who support Gbagbo have raided about 10 homes of Ouattara ministers. Most of the ministers had already vacated their homes and are staying at a hotel with Ouattara.
The rebels, who never fully gave up their fight when the country's 2002 civil war petered out and oppose Gbagbo, have been moving from one town to another, adding to the territory under their control.
"It's a big defeat for Gbagbo and his forces," rebel spokesman Lacine Mara told the Times by phone. "Our objective is to establish the rule of law in Ivory Coast. Mr. Gbagbo lost the elections. His troops, all they do is take it out on civilians."
The newspaper said a leader of the Front for the Liberation of the Greater West, a militia allied with Gbagbo, declined to comment on the situation.