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Around 2,000 Syrian troops have crossed the border into Iraq and sought refuge, the mayor of Al-Qaim border town Turki Al-Mahlawi.
Some of the troops were wounded and are currently receiving medical treatment, he added.
Rebels on a lightning advance through Syria said they were nearing Damascus on Saturday, although Bashar al-Assad’s government denied that the army had withdrawn from areas around the capital.
“Our forces have begun the final phase of encircling the capital,” said rebel commander Hassan Abdel Ghani.
The leader of Hayat Tahrir al-Sham (HTS) told fighters to prepare to take the seat of Assad’s government, just over a week into a renewed rebellion in the long-dormant conflict.
“Damascus awaits you,” said HTS’s Ahmed al-Sharaa in a statement on Telegram, using his real name instead of his nom de guerre, Abu Mohammed al-Jolani.
Syria’s defense ministry said army forces were “present in all areas of the Damascus countryside”.
“There is no truth to news claiming our armed forces […] have withdrawn” from positions near Damascus, it said.
In a Damascus suburb on Saturday, witnesses said protesters toppled a statue of the late President Hafez al-Assad, who handed Syria’s rule to his son.
Similar scenes were witnessed in images shared by local media in the southern city of Daraa and online footage verified by AFP from Hama, north of the capital.