But many of the thousands who fled are still too scared to return, and new refugees have been escaping in large numbers as the military again cracks down on those same militants after repeated attacks on security forces and pro-government tribes.
"This is a search operation in a limited area within Khyber Agency to locate and eliminate militant hideouts," a military official told Reuters.
"The situation was becoming unacceptable."
Pakistan needs a tight grip on Khyber.
One of the main supply routes for US-led NATO forces in Afghanistan runs through the area, a wedge of tan-coloured mountains sandwiched between the city of Peshawar and the Afghan border.
People who moved to the Jalozai camp in the nearby town of Nowshera told Reuters about 20,000 had fled since the latest operation began on Friday. Over 200 people were killed and about 40 villages destroyed, residents who fled said.
Khyber's history, and its current troubles, highlight the complexities of trying to stabilize Pakistan.
It is one of seven ethnic Pashtun tribal districts that straddle the porous border with Afghanistan and have never come under the full control of any government -- ideal places for militancy to thrive.
The Pakistani Taliban, the biggest security threat to the US-backed government, is not the main problem in Khyber.
The man causing trouble is Mangal Bagh, a former bus driver turned warlord who heads a relatively small militia called Lashkar-e-Islam, which seeks to apply Sharia, or Islamic law.
Residents recalled how he slowly started to impose his austere views years ago, while the military took little notice.
"People who they catch working for the government are beheaded and the deaths are announced by loudspeaker so everyone knows it is coming," said tribal elder Mir Akbar, as children in dirty plastic sandals looked on in the sprawling camp of white tents.
Tribesmen say they are forced to go to Bagh's people to settle disputes and are forced to pay taxes to them in cash, vehicles, weapons or food.
"The tribes are required to either send members of the family for certain periods of time to serve with Lashkar-e-Islam. Those who cannot afford to send male members must pay so they can hire fighters in their place," said a tribesman.
A similar situation arose in Pakistan's Swat region to the northeast. Taliban militants led by Maulvi Fazlullah fought the government for years and gradually imposed his radical rule.
The Taliban eventually capitalized on a truce with the government and took control of the valley of over one million, before being driven out by an army offensive in 2009.
Fazlullah regrouped across the border in Afghanistan and is now seen as a security threat again.
Stretched military
At Jalozai, displaced Khyber residents believe Bagh and his fighters will also melt away in Afghanistan if he needs to.
Islamabad has come under immense pressure to crack down on militants since US special forces killed al Qaeda leader Osama bin Laden in a unilateral raid in a Pakistani town in May, where he had apparently spent years.
But the army says it has its hands full fighting the Pakistani Taliban and can't possibly go after all militants at once.
So Bagh and his men -- who hang black flags on their turf -- could gain breathing space if the military is distracted elsewhere.
People like Syed Marjan remain on edge in Jalozai, originally set up in the 1980s for Afghans fleeing war in their country.
"They kidnapped my brother because he is a soldier. They said they would kill him unless he quit the army," he said.
Lashkar-e-Islam (Army of Islam) has several enemies, including the Pakistani Taliban, local warlords and tribes which the government has recruited to fight militants.
But residents say it's the most dangerous player in Khyber and acted with impunity for years. Lashkar-e-Islam first raised concerns when it began making forays into the provincial capital Peshawar to impose their Taliban-style ways.
Bagh's men kidnapped people, attacked music and video shops and ordered barbers to stop shaving men's beards in line with hardline Taliban edicts.
"If they think you gamble or drink, they just execute you in a public square and everyone has to watch," said Fazal Azim, 25, a laborer. "They announce it in mosques."
COMMENTS (13)
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Before criticising this Pakistan Army you should all first know ground facts!!! Army had launched an operation against this animal Mangal Bagh but then he and his small militia had surrendered claiming that they had no intention to fight the Pakistan Army! SO they were spared, now that the back of TTP animals has been broken, this Mangal Bagh in all these years has grown stronger and regrouped and of course we all know that from across the border who supports such people to wage a war against Pakistan Army and its innocent people( CIA and RAW in Indian consulates give them all the support)!!! Pakistan Army is still stretched battling all the insurgents who cross the border from Afghanistan with all the logistic support, Mangal Bagh's turn will come soon again InshaAllah! People like TTP,FAzlullah,Mangal Bagh are planted to defame Islam and its true spirit! It's all a conspiracy if only some sane mind would try to understand!
@Ashraf: What are you waiting for? Instead of waiting for him to bring the change, go to him and enjoy the fruits of his hospitality and his brand of Sharia.
Wow, A former bus driver war lord now will tell us that what is Islam ignoring all the great Islamic scholars we had and currently have. A Big Big Big Wow for this
Go on Mangal. Do it all over Pakistan and you will get the next nobel prize
oh Great!! why everyone starts forcing shariah law on Pakistani. I mean why don't force on their own people first like Afghanistan and make it a proper model state then show us the progress and then force shariah law?
@Ashraf
Your hero is involved in sectarian killings of his rival gang Ansar ul Islam. Also tell which sect of Islam must be taught for 18 years. Mangal bagh prefers deobandi
Send Imran Khan to talk to Mr. Mangal Bagh :)
18th Amendment gives so many powers to the provinces why not allow what these people want to adopt???? Why referendum is not held in KP to now the exact position??? I would rather go many steps forward and request the government to hold country wide referendum on the issue of Shariah and its implementation. Let the 18 plus million decide and then take action in favor or against so that killings or bomb blasts are stopped, innocent lives saved. Future and welfare is with the wishes of majority and not section of certain individuals.
"40 villages destroyed [during the Pak Army operation]..." It reminds me of the Soviet troops would blindly bomb the villages in Afghanistan during the war.
Way to go Mangal !! This is a welcome development. Pakistan needs Sharia Law. Also Islamic education must be compulsory until 18 years of age.
The military targets those terror outfits only who attack them but leave others, who are indulging in mayhem and killing of innocent people. Such a policy is going to be counter-productive in the long run since Talebanisation of the state would commence from these areas.
Well you don't have to be a genius to nab these kind of people ... "But the army says it has its hands full fighting the Pakistani Taliban and can’t possibly go after all militants at once." So which militants is the army going after at the moment? We have armed forces consisting of more than half a million "well trained" men. Yet not able to get rid of a bus driver, Is this some kind of joke or what. Swat and SWA operations have finished long ago .. they should stop with their hibernation and catch these guys .. one is former bus driver other one used to work in a bodybuilding gym ... as the article says all of them take refuge across the border and then regroup there, if its so well known then what has the GoP done so far to seal the border if any? Have they taken any steps towards that apart from repeating the same old mantra of we have established check posts as it seems those check posts have never captured any one in last so many years. Its time to seal the border and then capture/kill these kind of barbarians. Besides, isn't it evident from the story that they openly do announcements in the mosques then why aren't we able to kill them on the spot despite having an air force.