Two soldiers were killed in Thursday's clashes, and another 20 injured, said military spokesman Brigadier Udaya Nanayakkara.
The military says the rebels have lost 7,158 fighters since January, when Colombo pulled out of a Norwegian-brokered ceasefire.
The defence ministry has acknowledged the loss of 697 soldiers over the same period.
The Liberation Tigers of Tamil Eelam (LTTE) did not comment on the ministry claims, but a pro-rebel Tamilnet website said one civilian was injured in a bombardment Thursday of Kilinochchi, where the rebel headquarters are located.
The air force bombed the Tigers head offices inside Kilinochchi, as troops advanced on the town that has been in rebel hands for a decade.
The government has announced plans to raise defence spending by seven percent to 1.
6 billion dollars in 2009, from 1.5 billion dollars this year, to main