Defence Secretary Geoff Hoon has praised coalition forces' "remarkable advance" in Iraq as British troops establish a toe-hold in Basra.
Soldiers pass burning oil supplies as they enter the city
Mr Hoon said the taking of Baghdad airport was a "huge psychological blow" to the Iraqi regime but he warned there was still some way to go to the centre of the capital city.
The absence of Saddam Hussein's elite Republican Guard was worrying, he told BBC Radio 4's Today programme on Friday, and it was possible the coalition faced a "significant military challenge" in the city.
Meanwhile in the south of the country, British forces continue to make advances on Iraq's second city, Basra.
They have set up a base within the city for the first time in more than two weeks of fighting.
Troops are reported to be four miles from the city centre, having crossed the Shatt al-Basra waterway near the southern city limits for the first time.
Armed Forces Minister Adam Ingram said on Friday afternoon Basra was "contained" and that restraint by British forces should not be viewed as a weakness.
He told a media briefing there was "no humanitarian crisis in southern Iraq", although he acknowledged "the situation is far from ideal".
Once inside Basra he said the priority would be to fully restore the water supply.
He said coalition forces "deeply regretted" any civilian casualties during the conflict and was committed to keeping them to a minimum.
Infantry from the 1st Battalion Irish Guards, supported by Challenger 2 tanks and Army Lynx helicopters, met limited resistance as they moved
The defence secretary said the American taking of Saddam Hussein International Airport would send a signal to the people of Baghdad that "we're here".
Hovercraft patrol the Shatt al-Basra waterway
"We know that they've been told by the leadership that there are no coalition forces anywhere near Baghdad," he told Today.
"They will be able to see for themselves how untrue that is."
Mr Hoon again defended the UK's use of cluster bombs in the conflict.
"There is strong military advice they are essential and if you do not use them you would be putting our forces at greater and therefore unnecessary risk," he added.
The BBC's Caroline Wyatt, with UK troops in southern Iraq, said on Friday that they now had a "toe-hold" in Basra itself.
It was still on the outskirts, she said, although a technical college had been seized from which Iraqi mortars were being fired at UK checkpoints
"It seems to be the policy to patiently take it bit by bit at the moment, they're literally inching ahead into the city," Wyatt said.
Crossing the Shatt al-Basra reinforces our message to the people of Basra that we are here to stay
Senior US military officials say they have been impressed by the tactics and could copy many of the more effective techniques when it comes to furthering their advance into Baghdad.
The UK troops are keen to defeat the 1,000 or so Iraqi fighters believed to be holed up in Basra, so that food and water could be given to ordinary Iraqis still in the city.
Major Ben Farrell, commanding officer of 2 Company, 1st Battalion Irish Guards, told a pool reporter that the creation of a forward base was an important move.
"Crossing the Shatt al-Basra reinforces our message to the people of Basra that we are here to stay and gives us a base within the city," he said.
The UK forces' tactics have also involved the setting up of an advanced vehicle checkpoint (VCP) just outside the city to "poke a toe into Basra to see what happens".
The VCP, set up on the main traffic junction leading to the city, is the furthest forward any unit of the British Army has been, to provide a contact with civilians going in and out.