Jani Khel, a district in the mountainous province of Paktia, on the border with Pakistan, lies on a strategic road intersection, linking other districts in the province and its loss was considered a serious setback by security forces.
A spokesperson for the provincial governor said that a clearance operation was still under way.
Greater access: Afghan Taliban seize key Paktia district
Taliban operations have intensified after a lull that followed the death of the group's former leader Mullah Akhtar Mansour in May.
Security forces have been under heavy pressure from Taliban fighters from Helmand in the south, where US advisors were deployed last month to bolster defences, to Kunduz, the northern city that fell briefly to the Islamist insurgents last year.
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