Islamic State (IS) leader Abu Bakr al-Baghdadi has admitted defeat in Mosul, the terror group's biggest stronghold in Iraq, and has ordered militants to either flee or kill themselves in suicide attacks, media reported.

Abu Bakr al-Baghdadi made a "farewell speech" to his combatants in battlefields, ordering them to "flee and hide in mountainous areas" in Iraq and Syria, media reported on Wednesday.

The text of the speech was disseminated among other speakers to read out to fighters at various areas in western Mosul.

The directives tell fighters to blow themselves up once encircled by Iraqi troops, adding that senior commanders close to Baghdadi were moving on the borderline between Syria and Iraq.

Iraqi forces have made remarkable gains since launching a renewed offensive on February 19 to retake western Mosul from IS militants.

The government said in January it had retaken the eastern side of the city following three months of fighting, media added.

Earlier this month, unconfirmed news claimed that Baghdadi, whose exact whereabouts remain unknown, had been seriously wounded when airstrikes targeted a senior leadership meeting he chaired near the borders with Syria.