The capture of Mullah Abdul Ghani Baradar, the Taliban's top strategist, deals a psychological blow to the insurgents currently fighting British troops in southern Afghanistan.
As the right-hand man of the reclusive Taliban leader Mullah Mohammad Omar, Mr Baradar takes responsibility for day-to-day campaigning and is the most senior Taliban member to travel inside Afghanistan regularly.
Yet, unprecedented as the incident is, observers are cautious about extrapolating too much from the reports of his arrest. "It's impossible to be specific about the way this will develop," said a security analyst in Kabul. "It's wait-and-see time."
Hurting the leadership is just one component of the West's strategy to defeat the militants and "for the most part, catching one individual is going to have no effect on a network," the security analyst said.
Mr Baradar may be an exception, as the Taliban's immediate denial of his arrest would suggest. "He has not been captured," their spokesman, Zabihullah Mujahid told Reuters. "They want to spread this rumour just to divert the attention of people from their defeats in Marjah."
But the critical part of the West's counter-insurgency campaign remains driving a wedge between the Taliban and the civilian population they hide among. Smashing their finances is another priority.
Nato's best hope is that Mr Baradar's capture demoralises other Taliban leaders and temporarily disrupts their ability to plan. This would come as a relief to US Marines and their allies who are slowly taking ground from tenacious guerrilla fighters in Helmand province.
Reports from the front continue to tell of painstaking progress through heavily mined fields and hamlets, and dogged defence by Taliban snipers.
Some allied soldiers said the insurgents were becoming disorganised after a fourth consecutive day of fighting. Helmand's governor said a Nato airstrike had killed a Taliban commander responsible for marshalling foreign militants in the province.
Meanwhile, the coalition admitted responsibility for the deaths of several more civilians. One man was caught in crossfire, and two others shot when they ignored warnings to stop.
Confusion is emerging over the sequence of events that led to the deaths of a dozen civilians on Sunday, with some blaming an errant rocket and other reports suggesting Nato fired on insurgents with out realising a family was in the same building.
Several thousand civilians have successfully made the treacherous journey to the provincial capital of Lashkar Gah where aid agencies are providing food and shelter.
In an astonishing display of courage, several local taxi drivers organised an informal ambulance service, driving casualties to treatment along 20 miles of roads sown with homemade bombs.
* In an incident unconnected with Operation Moshtarak, a British soldier was reported killed by an explosion near patrol base Ezaray in Sangin district in northeast Helmand.