(CNN) -- French-led troops in Mali now control the ancient city of Timbuktu, the city of Gao and the swath in between that was an Islamist stronghold for almost a year, the French Defense Ministry said.
"We are winning in Mali," French President Francois Hollande said at a news conference Monday, but he added that militants still control parts of the north.
Hollande did not say how long France will maintain troops in its former colony.
The country has 2,150 soldiers on Malian soil, with 1,000 more troops supporting the operation from elsewhere.
The United States has also stepped up its involvement in the conflict by conducting aerial refueling missions on top of the intelligence and airlift support it was already providing.
Britain said Tuesday it will provide military support but won't take part in combat. The United Kingdom is prepared to deploy up to 40 troops to a European Union military training mission in Mali, and up to 200 troops as trainers in English-speaking West African countries, British Defence Minister Philip Hammond told lawmakers in the House of Commons.
In addition, the European Union said Tuesday it will contribute $67 million to support the African-led International Support Mission to Mali.
The nations are joined together in an effort to prevent the Islamists from turning the once peaceful democracy into a haven for international terrorists.
The Islamic extremists carved out a large portion in northern Mali last year, taking advantage of a chaotic situation after a military coup by the separatist party MNLA. They banned music, smoking, drinking and watching sports on television. They also destroyed historic tombs and shrines there.
But with the French-led offensive sending the militants on the run, residents once again roamed the streets without fear.
Flushing the Islamists out of Timbuktu, Mali's historic cultural center, is a big symbolic gain.
Amid international outrage, the Islamists repeatedly targeted Timbuktu's ancient burial sites. They regarded such shrines as idolatrous and thus prohibited by their strict interpretation of Islam.
As a column of military vehicles drove through Gao over the weekend, villagers chanted "Mali! Mali!"
Young men on motorcycles rode alongside the convoy, wildly waving Mali's flag and euphorically praising France and freedom.
Others lined the sides of the street, holding up beer bottles. They could once again drink, free from the oppressive dictates of the Islamists.
The mayor of Gao returned from exile and addressed the boisterous crowd. No one could hear a word he said. But it didn't matter. He was back -- another sign that normalcy was returning.
Raising money for Mali
Other countries in Africa and around the world have pledged $455 million at a donors' conference for Mali in the Ethiopian city of Addis Ababa.
Among the donors, Japan pledged $120 million, the United States pledged $96 million, pending congressional approval, and the European Union pledged just over $67 million. Senegal, Nigeria and Ghana pledged $3 million each, and China and India pledged $1 million each.
"I thank you on behalf of the people of Mali," Malian President Dioncounda Traore said. He announced plans to hold elections on July 31.
The money will support military efforts led by the African-led International Support Mission in Mali and the Malian army, the work of the Economic Organization of West African States on Mali and humanitarian assistance.
U.N. gears up for returns
More than 380,000 people have fled northern Mali in the last year: 230,000 are internally displaced, and more than 150,000 refugees are in Mauritania, Niger, Burkina Faso and Algeria, the United Nations says.
But now, as French and Malian forces take back ground from militants, the U.N. refugee agency is preparing for the "possible spontaneous return of thousands of conflict-displaced people."
The agency, in a statement, reported that displaced people interviewed in the capital, Bamako, said they hoped to return soon.
"Returns are not yet a wide trend, but they are already being seen in some instances," the agency said.
Displaced people told U.N. interviewers that they hope to return soon to areas such as Gao, Timbuktu and Kidal. U.N. officials say people are returning to Konna, which many residents fled after militants overran that city.
The seizure of Konna, on January 10, prompted the French military intervention in Mali. The town is back under Mali's control.
Journalists Lindsey Hilsum and Isma'il Kushkush and CNN's Joe Sterling and Richard Greene contributed to this report.