The Islamic State of Iraq and Syria (ISIS) has raised its flag over government buildings in the city and declared an independent Islamic state, Voice of America reported Saturday.
Witnesses said there was no sign of government forces inside the city, located in Anbar province.
Al-Qaida cut power lines to the city late Friday and ordered residents not to use backup generators,witnesses said.
Government security forces and allied tribal leaders disputed claims Friday ISIS was in full control of the city, the New York Times reported. By Friday night, the joint forces said they had recaptured part of the main street and a municipal building.
Mohamed al-Isawi, the head of the Fallujah police, said he was gathering forces north of the city for what he hoped would be a successful effort to retake the city.
In the Anbar capital of Ramadi, a tribal leader said his fighters, along with police, had forced al-Qaida loyalists from the city. He said the local ISIS leader was killed during the battle.
Sunni extremists affiliated with al-Qaida control large portions of Anbar province. Local tribesmen, while not strong supporters of the Shiite-dominated government, have sided with the army and police against al-Qaida.