The Afghan Islamic press says that Taleban leader Mullah Mohammed Omar has decided to leave his headquarters in Kandahar within 24 hours and retreat into the Afghan mountains.
Quoting its own sources, the news agency says Mullah Omar has decided to hand over the city to local leaders.
The report says the Taleban ordered the retreat after several days of consultations with its military commanders.
Earlier Friday, U-S intelligence officials said there are credible reports a top member of Osama bin Laden's al-Qaida terror network was killed earlier this week during air raids in Afghanistan.
The reports say Mohammed Atef, the al-Qaida military commander, was probably hit during U-S air strikes south of Kabul. There were no further details. U-S intelligence sources say Mohammed Atef was Osama bin Laden's chief aide and likely successor as head of al-Qaida. U-S officials also accuse the former Egyptian police officer of involvement in planning the September 11th attacks on the United States and have indicted him in connection with the 1998 bombings of two U-S embassies in east Africa.
U-S Defense Secretary Donald Rumsfeld says there is every reason to believe that Mr. bin Laden is still in Afghanistan. When asked about unconfirmed reports that he has fled to Pakistan, Mr. Rumsfeld said if that turns out to be true, he will ask Pakistan to capture him.
Meanwhile, Opposition ground troops also are attacking Kunduz, the last remaining Taleban stronghold in northern Afghanistan. Northern Alliance forces are said to be in combat with several thousand Pakistanis and Arabs loyal to fugitive terrorist suspect Osama bin Laden.
Islamabad has dismissed an Iranian radio report saying Osama bin Laden and Taleban Supreme Leader Mullah Omar have fled into northwest Pakistan. A Pakistani government spokesman said the military is committed to keeping Taleban and al-Qaida leaders on the Afghan side of the border.