The fighters, loyal to secular warlord Abdi Awale Qaybdiid, turned over their arms and pickup trucks mounted with heavy weapons to the Islamic militia, top Islamic commanders said.
"They were holed up inside buildings and we were pounding them with heavy artillery and mortars from every corner," said Abdi Shakur, an Islamic fighter. "They had no option but to surrender."
The Islamic militia wrested Mogadishu from a U.S.-backed secular alliance of warlords last month, but Qaybdiid had refused to disarm. Late Monday, he escaped to the town of Baidoa, 90 miles from Mogadishu, his cousin, Salad Ali, told The Associated Press.
The new violence started Sunday and broke weeks of relative calm under the rule of the Islamic fighters, who have grown increasingly radical since seizing Mogadishu and establishing strict courts based on the Quran. Mortar shells and gunfire shook the city for two days, sending residents into homes and shops or fleeing Mogadishu altogether.
More than 70 people were killed, most of them combatants, according to doctors and hospital officials. The 150 wounded appeared to be mostly civilians, doctors said.
"We will not allow other militiamen in Mogadishu to remain armed," Sheikh Sharif Sheikh Ahmed, a top Islamic official, said Tuesday.
Mogadishu was quiet after Tuesday's surrender, and cars were moving freely through the city again. Members of the Islamic militia went house to house searching for any weapons that Qaybdiid's fighters might have hidden.
Somalia has been without an effective government since warlords overthrew its longtime dictator in 1991 and divided the nation into fiefdoms. The Islamic fundamentalists have stepped into the vacuum as an alternative military and political power.
The volatile nation in the Horn of Africa has been a particular concern to the United States, which has long-standing fears that Somalia will become a refuge for members of Osama bin Laden's terrorist network, much like Afghanistan did in the late 1990s.
U.S. officials cooperated with the warlords, hoping to capture three al Qaeda leaders allegedly protected by the Islamic council who are accused in the deadly 1998 bombings at the U.S. embassies in Kenya and Tanzania.
But the Islamists prevailed, taking the U.S. by surprise and further marginalizing the country's interim government. The interim body was established with the help of the United Nations but is powerless outside its base in Baidoa.
The militia has forbidden movies, television and music. Last week, militiamen in central Somalia fatally shot two people at the screening of a World Cup soccer broadcast banned because it violated the fighters' strict interpretation of Islamic law. They also broke up a wedding because it featured a band and men and women socializing together.
Also Tuesday, Ahmed of the Islamic militia again accused neighboring Ethiopia of sending troops across the border. Ethiopia has intervened in Somalia in the past to prevent Islamic extremists from taking power.
"I call on all Somali people to be ready for a holy war against the flagrant aggression of Ethiopian soldiers in Somalia," Ahmed said.
The president of Somalia's interim government, Abdullahi Yusuf, is allied with Ethiopia and has asked for its support. Ethiopian officials did not immediately return calls for comment Tuesday, but they have denied previous accusations.