The operation to retake the hometown of former president Saddam Hussein began on March 2 and had looked bogged down before Iraqi forces made rapid advances in the past 48 hours.
Prime Minister Haider al-Abadi "announces the liberation of Tikrit and congratulates Iraqi security forces and popular volunteers on the historic milestone," his official Twitter account said.
He was referring to volunteer forces which played a major role in the fighting to retake Tikrit, a city which ISIL had controlled since it captured swathes of Iraq in June.
In a statement to AFP just minutes before Abadi's tweet, his spokesman Rafid Jaboori said: "Iraqi forces reached the center of Tikrit, raised the Iraqi flag and are now clearing the city."
The provincial government headquarters was retaken on Monday and on Tuesday the Iraqi tricolor replaced the black ISIL flag on the building.
In scenes captured in an AFP video, jubilant fighters can be seen tearing up the black flag amid the extensive destruction in the city.
"We are in the center of Tikrit. The city and all administrative buildings were completely liberated," said one of them, policeman Bahaa Abdullah Nasif.
Iraqi military officials have been saying since the start of the operation that ISIL fighters had laid thousands of bombs in streets, houses and tunnels to make their last stand.
Tikrit holds both strategic and symbolic importance. It was the hometown of executed dictator Saddam Hussein, remnants of whose Baath party collaborated with ISIL last summer.
Defence Minister Khaled al-Obeidi met all his top commanders Tuesday to discuss preparations for an operation to retake the Nineveh province, of which Mosul is the capital.
"This victory is only a new starting point from which to launch the operation to liberate Nineveh province," Iraqi ministry of defense said.
Mosul, Iraq's second city, is close to 10 times the size of Tikrit and still holds a large civilian population.