The troops exchanged heavy fire with insurgents, killing at least seven in an offensive they hoped would also cut Taliban supply lines and isolate their fighters.
Associated Press journalists traveling with the first wave said militants fired small arms, mortars and rocket-propelled grenades after helicopters dropped the troops over Taliban lines. Fighting lasted more than eight hours, as Harrier jets streaked overhead and dropped flares in a show of force.
The Taliban put up such fierce resistance that Marines said they suspected the militants knew the assault was coming.
Other Marines met heavy resistance as they fought to seize control of the mountains surrounding Dahaneh in the southern province of Helmand. Another convoy of Marines rolled into the town despite roadside bomb attacks and gunfire.
It was the first time NATO troops had entered Dahaneh, which has been under Taliban control for years.
U.S., NATO and Afghan troops are working to protect voting sites around the country so Afghans can take part in the country's second-ever direct presidential election on Aug. 20. Taliban militants have vowed to disrupt the elections, and attacks are on the rise.
Marines say they captured several suspected insurgents in the push and seized about 66 pounds of opium, reports CBS News correspondent Mandy Clark. The militants use profits from the drug to finance their insurgency.
Troops hope to restore control of the town so that residents can vote in the election.
The new offensive, named "Eastern Resolve 2," is designed to break the monthslong stalemate in this southern valley where the Taliban are solidly entrenched. By occupying Dahaneh, the Marines hope to isolate insurgents in woods and mountains, away from civilian centers.
"I think this has the potential to be a watershed," said Capt. Zachary Martin, commander of Golf Company, 2nd Battalion, 3rd Marines, who led the assault.
The goal is to cut off the Taliban from a major rear base, and reclaim the area's market district. It is hoped this would have a ripple effect through nearby villages, making civilians more willing to cooperate with NATO forces. The Taliban levy taxes and maintain checkpoints in Dahaneh, which serves as a main trading route through northern Helmand, which produces 60 percent of the world's opium.
"In the long term, it could have tremendous effects for the entire province," said Martin, whose company is based in Naw Zad, five miles (10 kilometers) to the north.
A combined force of some 500 U.S. and Afghan troops took part in the attack, which included helicopters, snipers, and female Marines brought in to interact with Afghan women during the compound-by-compound search conducted by Afghan forces who accompanied the Americans.
The Marines arrived in helicopters under cover of darkness, but at morning light, militants unleashed their weapons.
Marines cried out "Incoming!" as the whistles of Taliban rockets approached. A heavy rocket targeted a Marine outpost, but flew over the small base, while a mortar round landed just 20 yards (meters) from a Humvee on the town's outskirts.
"Just a few meters further and I'd be dead," said Corp. Joshua Jackson, 23, from Copley, Ohio, after one round landed nearby.
Progress into the town was slowed by a heavy machine gun the Taliban had in one of the streets. Militants also brought in a truck to fire heavy missiles. Marines said the Taliban's reputation for firing poorly aimed shots and fleeing had not proved true here.
"This is a Taliban home down here, so for once they're not running," said Lance Corp. Garett Davidson, 24, of West Desmorins, Iowa.
Fighting was made harder for the Marines by the fact insurgents were shooting from house rooftops and courtyards, potentially putting civilians in danger. But civilians perhaps 100 were seen fleeing on foot in the early morning, leaving the Marines confident that those left in the town were militants.
Martin said the Marines would strictly limit the type of weapons they used and would stick to a "proportional response" when under fire to limit civilian casualties.
After militants fired volleys of rockets from a mud-wall compound, the Marines called in a missile strike, and Capt. Zachary Martin said seven to 10 militants inside were killed. No civilians were inside, he said.
"We were tracking these individuals, they were there ... and then boom, and they weren't there," Martin said.
Martin confirmed suspicions among the Marines that the fierce resistance indicated that the Taliban had been tipped off about the operation beforehand. "I'm pretty sure they knew of it in advance," he said.
Once the second largest-town in Helmand, Naw Zad has been almost emptied of its 30,000 inhabitants after three years of near-constant fighting. Taliban lines begin barely a mile (a kilometer) from the Marines' forward operating base, set amid minefields with hundreds of homemade explosives. By occupying Dahaneh, the Marines say they can outflank the insurgents in Naw Zad valley and isolate them in woods and mountains.
By late morning a contingent of Afghan Army soldiers had driven into the section of the town now controlled by the Marines, and some Marines were preparing to head out for the first NATO patrol ever in Dahaneh. It planned to reach out to civilians possibly huddled in their homes as sporadic but fierce outbursts of intense gunfire continued through the morning.
The target at the start of the operation was two suspected Taliban compounds, which were raided commando-style by a group of Marines dropped behind enemy lines. A second group drove in from the Marines' main base in Naw Zad. Their goal was to secure what Marines have been calling "The Devil's Pass," a narrow passage between two steep hills that controls the entrance to the Naw Zad district.
The offensive follows "Eastern Resolve 1," which was the Marines' initial push out of Naw Zad in early spring. This first move was of limited effect, because U.S. troops were too thinly spread at the time to control areas they managed to claim from insurgents.
Casualties have mounted as U.S. and NATO troops ramp up military operations following President Barack Obama's decision to deploy 21,000 more American forces to Afghanistan this year to cope with the rising Taliban insurgency.
Last month, U.S. and NATO deaths from roadside and suicide bomb blasts in Afghanistan soared six-fold compared with the same month last year, as militants detonated the highest number of bombs of the eight-year war, according to figures released Tuesday.
Meanwhile, a bombing wounded two Associated Press journalists embedded with the U.S. military in southern Afghanistan - 120 miles southeast of Dahaneh.
Photographer Emilio Morenatti and AP Television News videographer Andi Jatmiko were traveling with a unit of the 5th Stryker Brigade of Fort Lewis, Wash., when their vehicle ran over a bomb planted in the open desert terrain, the military said.
Both men were immediately taken to a military hospital in Kandahar. Jatmiko suffered leg injuries and two broken ribs. Morenatti, badly wounded in the leg, underwent an operation that resulted in the loss of his foot.