The United Nations (UN) has accused South Sudanese rebels of violating a ceasefire by launching an offensive to recapture its former headquarters.
The attack on Nasir town was the "most serious resumption of hostilities" since May, the UN said.
The rebels said they had seized the town in an act of "self-defence". The government denied the town had fallen.
Fighting between government and rebel forces broke out in December, leaving more than a million homeless.
President Salva Kiir and rebel leader Riek Machar met in May and recommitted themselves to a ceasefire negotiated in January by regional leaders.
Rebel spokesman Lul Kuang said they launched an offensive because of several attempts by government forces to arrest their commander.
"The fall of Nasir now paves the way for military resources to be refocused on Poloich Oil Fields, Maban and Malakal," Mr Kuang said in a statement.
South Sudanese army spokesman Philip Aguer denied Nasir had fallen following clashes between the two sides.
"It is deplorable that this major attack comes at a time when intensive efforts are under way by mediators of the Intergovernmental Authority on Development (IGAD) to convince all parties to resume the suspended peace talks in Addis Ababa," Unmiss acting head Raisedon Zenenga said in the statement.
"The attack is a clear violation of the cessation of hostilities agreement," he added.
South Sudan is the world's newest state and became independent in 2011.
Conflict erupted in December after Mr Kiir accused Mr Machar, his sacked deputy, of plotting a coup.
Mr Machar denied the allegation, but then marshalled a rebel army to fight the government.
The UN has about 8,500 peacekeepers in South Sudan. They have struggled to contain the conflict.