Some armoured vehicles from the elite Counter-Terrorism Service (CTS) returned from the streets of Al-Karamah a few hours after moving in and encountering fierce resistance from the Islamic State group, an AFP correspondent reported.
"We weren't expecting such resistance. They had blocked all the roads," said one officer, as top brass considered whether or not to attempt a fresh foray.
"There are large numbers of jihadists... It was preferable to pull back and devise a new plan," the CTS officer said, speaking on condition of anonymity.
Some CTS forces remained inside the city however and there were at least five regiments involved in the operation launched Friday, making it hard to gauge the extent of the pullback.
After daybreak, bulldozers and tanks backed by air strikes had pushed into the streets of Mosul from the east for the first time since Iraqi forces launched a broad offensive to retake the city on October 17.
The CTS's "Mosul regiment", which was the last to leave the city when the jihadists overran it in June 2014, immediately faced "tough resistance", commander Muntadhar Salem told AFP.
The gunfire was almost uninterrupted for hours and reports from the front crackling into CTS radios said IS had set up barriers and laid bombs all along the streets.
Air strikes by the US-led coalition had intensified over the past two days, despite the smoke from burning tyres set on fire by IS in a bid to provide cover.
They ebbed when the push on the ground got under way however.
The resistance came despite widespread reports in recent weeks that top IS commanders had left the eastern side of the city and crossed the Tigris river to regroup on its west bank.
Back from the dead
An estimated 3,000 to 5,000 IS fighters are scattered across the sprawling city, Iraq's second largest, where a million-plus civilians are believed to be trapped.
There has been an exodus of civilians from outlying villages this week but few managed to find a safe way out of the city itself.
Umm Ali could not hold back her tears when she spoke of her constant fear the jihadists would take her young sons.
"They kept coming to our home. Sometimes they'd knock on the door at 10:00 pm," she said. "They took our car, saying: 'This is the land of the caliphate, it belongs to us'."
Civilians seeking refuge in Kurdish-controlled areas east of the city recounted tales of IS brutality.
"We're coming from the world of the dead back to the world of the living," said Raed Ali, 40, who fled his home in the nearby village of Bazwaya.
In a rare audio message released on Thursday, IS leader Abu Bakr al-Baghdadi urged his fighters to defend the city where he proclaimed the "caliphate" in June 2014.
The public announcement he made from the pulpit of Mosul's Great Mosque of al-Nuri heralded the most ambitious and brutal experiment in modern jihad, a period marked by mass murder, attempted genocide and slavery.
But his "caliphate" has been shrinking steadily since mid-2015 and the loss of Mosul would leave Raqa, in Syria, as the group's only major urban stronghold.
IS has been increasingly pragmatic in its tactics this year, falling back in the face of superior force even in some of its emblematic bastions such as Fallujah in Iraq and Dabiq in Syria.
Caliphate 'on defensive'
However Baghdadi, in his first message of 2016, called on IS fighters still in Mosul to make a stand for Iraq's second city.
"Holding your ground with honour is a thousand times easier than retreating in shame," he said.
Aymenn al-Tamimi, a jihadism expert at the Middle East Forum, said the tone of the half-hour speech was "very much of a caliphate on the defensive."
Iraqi forces and their Iranian and US-led coalition allies see the battle for Mosul as capping a two-year recovery from the rout that saw IS sweep through the Sunni Arab heartland north and west of Baghdad.
As they regained ground and the caliphate declined, defections from IS ranks increased, providing intelligence that enabled coalition aircraft to take out key field commanders.
IS has continued to post propaganda video from Mosul, the latest of which showed a busy market area and cars stopping at traffic lights.
With colder weather setting in, concern has grown for the city's civilian population.
Aid groups say up to a million people could seek to flee as soon as they can, but shelter is available for only a fraction of that number.
The United Nations says it has received credible reports of IS forcing tens of thousands of civilians into Mosul from outlying areas for use as "human shields".