Islamist militant group al-Shabab has taken control of the port city Merca, residents say.
Merca, some 70km (45 miles) south-west of Mogadishu, is now the biggest town under al-Shabab control.
African Union forces who had held the port city for three-and-a-half years withdrew earlier on Friday morning.
The loss is a major setback for the African Union force (Amisom) in its decade-long battle against al-Shabab, the BBC’s Tomi Oladipo says.
The governor of Somalia’s Lower Shabelle region Ibrahim Adam told the AFP news agency that al-Shabab secured control without fighting.
“Amisom forces moved out at midday and the local administration and all other Somali security forces left a few minutes later – and then heavily armed al-Shabab militants entered the town,” local resident Ibrahim Mumin told AFP.
“They have been addressing residents at the district headquarters,” he added.
Another resident, Mohamed Sabriye, told AP news agency that al-Shabab fighters had hoisted their flag over the city’s police station and administrative headquarters.
The withdrawal from Merca comes three weeks after al-Shabab overran an African Union military base outside the southern Somali town of el-Ade, saying they had killed about 100 Kenyans soldiers.
Kenya has not said how many of its troops died.
Al-Shabab was ousted from the capital, Mogadishu, in August 2011, but still has a presence in large areas of southern Somalia and often stages attacks across the country.