Patriotic Union of Kurdistan (PUK) official Shorsh Jalalal said the rival Kurdistan Democratic Party (KDP) group struck at PUK positions in five villages around Halabja, 10 km (six miles) from the Iranian border.
But with the support of new forces moved into position, control of three of the villages was regained late last night, Jalalal told Reuters.
The latest attacks marked an expansion of the front in the inter-Kurdish fighting, which took on fresh urgency last weekend with Baghdad's intervention on behalf of the KDP.
The PUK leader Jalal Talabani has said he would seek Iranian help if necessary to counter joint attacks by the KDP and Baghdad's forces, which teamed up last weekend to oust the PUK from the main Kurdish city of Arbil.
Turkey has indicated that it might also join in the fray, moving forces in to stop anti-Ankara Kurdish separatists of the Kurdistan Workers Party (PKK) from using the region as a springboard for attacks in southeast Turkey.
PUK officials said joint forces of the KDP and Iraq began to advance from Arbil along the north route towards PUK's stronghold Sulaimaniya, via Degala and the key town of Koi Sanjaq.
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The KDP said it had killed more than 100 PUK guerrillas in fighting around Arbil, but the PUK said the casualty figures were exaggerated.
Baghdad's move into the Western-protected north drew U.S. cruise missile attacks on targets south of the Iraqi capital. Washington said on Thursday that Iraqi troops had withdrawn.
However, opposition groups report continued Iraqi involvement in support of a KDP advance along the main road toward Sulaimaniya.
A Reuters reporter who toured the region south of Arbil on Thursday saw Iraqi tanks dug in but no evidence that they were engaged in the latest fighting.
Iraqi regular army, Republican Guards and KDP forces moved their direction to Degala and Koi Sanjaq, where the land is flat, said Riza Ghafur, head of the PUK foreign relations office. He said the forces had advanced seven km (four miles).
He said the KDP and Iraqi troops also continued to shell Chamchamal, on another route to Sulaimaniya. Sulaimaniya is around 120 km (70 miles) southeast of Arbil.
According to the PUK, the joint forces are supported by 100 tanks and rockets and had on Friday morning captured Qushtapa, a town 22 km (15 miles) south of Arbil.
KDP spokesmen say more than 100 PUK guerrillas and a handful of KDP fighters were killed in fighting around Arbil in the past two days. It denied there was any fighting near Iran.
PUK spokesmen did not give any casualty figures, but said the KDP was exaggerating.