The Free Syrian Army say government forces backed by Hezbollah fighters have taken control of the strategic town of Qusair.
Rebels were forced to withdraw overnight due to overwhelming firepower and a lack of supplies.
In a statement those opposed to the regime in Damascus said hundreds have been killed in the onslaught.
The town, close to the Lebanese border. has been the scene of fierce fighting for the last two weeks.
The Syrian state news agency hailed government forces as “heroic.”
More than 80,000 people have been killed in the conflict, which began in 2011.
The UN claimed on Tuesday that the war has now reached “new levels of brutality.” with growing evidence of atrocities on both sides.