Iraqi forces repelled an offensive launched in the early hours of Saturday by Islamic State on the Sunni town of Shirqat, south of Mosul, during which more than 30 military and civilians were killed and 40 more wounded, Reuters reported.
About a dozen Islamic State fighters were also killed in the fighting, which ended around midday, the sources said.
About half the dead in the city were civilians and the rest members of the Iraqi armed forces and Sunni tribal fighters. A curfew was still in place in the early evening.
Islamic State lost Shirqat to U.S.-backed Iraqi government forces and tribal fighters last year. Its fall paved the way for the offensive on Mosul, the militants' de-facto capital in Iraq.
Eight months into the U.S-backed offensive to take back Mosul, all of the city has been retaken by Iraqi government forces except an enclave by the western bank of the Tigris river.
The militants continue to control pockets south and west of Mosul, as well as swathes of territory near the border with Syria and inside Syria.