Mali's army has recaptured Konna after Islamist rebels fled, the military and residents in the strategically important central town have said.
France began its intervention in Mali a week ago because of the rebel takeover of the town north of the capital.
Earlier this week, French officials denied a claim by the Malian army that the government had regained Konna.
Meanwhile, the UN refugee agency says it fears the fighting could force 700,000 people from their homes.
Some 150,000 people have already gone to neighbouring countries, Reuters news agency reports .
It quotes the UNHCR as saying that 400,000 more could flee Mali, with a further 300,000 displaced within the country.
The first 100 troops of an African force landed in the capital, Bamako on Thursday evening.
The soldiers from Togo and Nigeria are part of a long-planned West African force that will join the French and Malian armies in fighting the Islamist insurgents who took over northern Mali last year.
Nigeria says it will increase its forces to 1,200.
On Thursday, France said it was increasing its troop strength to 1,400 after intervening initially with air strikes to try to halt a rapid advance by the Islamists.
Correspondents say a strong French contingent is at Segou, north-east of Bamako, to guard a major bridge across the Niger river, which the rebels would have to cross to threaten the capital.