Smoke billows behind a destroyed school as Iraqi forces and Islamic State militants fight near the Old City in western Mosul on June 13. (Erik De Castro/Reuters)

Dozens of Islamic State militants wearing suicide vests penetrated Iraqi police lines in Mosul on Wednesday, officers said, setting fire to houses to obscure the area from U.S.-led airstrikes in a large-scale counterattack that sent terrified residents fleeing. 

Starting around 3 a.m., the militants launched seven car bombs at the front lines south of the Old City, their last foothold, a federal police colonel said. Simultaneously, 25 fighters wearing suicide vests attacked police from behind their lines. Another police commander put the number of suicide attackers at 50. 

The militants had sneaked down the Tigris River and attacked with the assistance of “sleeper cells,” which provided vehicles for them, according to the police colonel, who spoke on the condition of anonymity because of the sensitivity of the situation. 

“They attacked our forces from behind while they were fighting against the car bombs,” he said, adding that the militants were lashing out in their “dying breath.”

After eight months of battle, Islamic State fighters have been penned into the narrow streets and alleyways of Mosul’s historic city center, as well as a small area around a hospital just to the north. 

Iraqi and U.S. military officials estimate that up to 1,000 fighters may remain in the area of just over a square mile. Trapped in their former stronghold, they apparently see little choice but to fight to the death. 

The colonel said the militants took over areas of the Dawasa and Dendan neighborhoods, setting fire to houses to protect themselves from airstrikes by the U.S.-led coalition. Photographs of the city showed thick clouds of black smoke hanging in the air. 

Police forces managed to retake most of those areas by midmorning, while suffering casualties, he said, without giving a figure. 

In a statement circulated online, the Islamic State claimed to have killed 40 in the attack, including a colonel, and destroyed eight vehicles. The Associated Press said 11 police officers and four civilians died. 

Saeed Hassan, 41, said his family was eating a pre-dawn meal before their daily fast during the Muslim holy month of Ramadan in their home in Dendan when they heard a large explosion. 

As the explosions grew louder and closer, the family realized that the militants had entered the neighborhood and hid under the stairs. Hassan’s house is next to a police base, and he said officers were fighting from his doorstep and the roof of the house next door.  

After an hour of clashes, the militants reached his mosque, and police forces decided to retreat. Hassan had been providing food for their forces, and he feared he would be killed by the militants if he stayed. 

“When I heard them yelling, ‘Let’s retreat,’ I told them, ‘I’m going to start my car and go with you,’ ” he said. “It was a very scary scene outside — dark and fire around us.” 

He followed the police Humvees as they withdrew to the airport, on the edge of the city.  He said that seeing them rush to their vehicles and withdraw gave him “flashbacks” to 2014, when security forces abandoned the city to Islamic State militants with little fight.

According to neighbors hiding in their houses, police forces have not returned to the streets, and it was unclear whether the militants have withdrawn, Hassan said. He said he will not return home until the Islamic State has been expelled from all of western Mosul.

Brig. Gen. Faris Radhi, director of the operations room at the federal police headquarters south of Mosul, said the Islamic State attack involved 50 suicide bombers, but he denied that his forces had lost ground.

“Clashes are ongoing,” he said. Iraqi forces and the U.S.-led coalition are “hunting them one by one,” he said. “The enemy has used the last card in this attack, which means this is the best they can do.” 

Col. Ryan Dillon, a spokesman for the U.S. military in Baghdad, said the coalition was supporting Iraqi forces to fight off the counterattack. “No ground has been lost,” he said. Iraq’s Joint Operations Command confirmed that Islamic State fighters infiltrated at dawn along the river. Police forces “surrounded the area” and have begun clearing it, a statement said. 

The federal police commander, Lt. Gen. Raed Shaker Jawdat, further played down the incident. He described it as a “tactical operation” by police forces aimed at drawing militants out of the Old City and into the secured area of Dendan so that they could be killed.