Authorities believe hundreds of jihadi fighters could still be hidden amid the ruins, who could take on Iraqi forces in suicidal ambushes.
Many have already been filmed emerging from their hiding places with US forces warning the danger is not over yet.
Days after Iraq’s prime minuter, Haider al-abadi, declared victory over ISIS forces in Mosul, jihadis were coming out of tunnels and basements.
US Army officer on the ground Lieutenant General Stephen Townsend said: “There are bypassed holdouts.
“We haven’t cleared every building in this city the size of Philadelphia.
“That’s going to have to be done, and there are also hidden improvised explosive devices (IEDs).
“There are still going to be losses from the Iraqi security forces as they continue to secure Mosul.”
ISIS fighters have been filmed coming out of their hiding places and Iraqi forces fear that many fighters could remain hidden amid the ruins.
The two sides exchanged gunfire on Wednesday killing a policeman and wounding two others.
An Iraqi military official said: “Right now, there are a handful of holdout ISIS terrorists that the Iraqi security forces are still trying to root out of the Old City.”
ISIS continues to hold the Iraqi towns of Tal Afar, Hawija and the Syrian capital Raqqa.
The campaign to liberate Raqqa is now underway.
Sir Michael Fallon, the Defence Secretary, has said the battle against IS are likely to remain if Iraq “well into 2018”.
Sir Michael said: “The campaign in Iraq is not over and has many months to run, and I expect British forces to be involved well into 2018 in Iraq, and of course the situation in Syria is even more complex.
“The work of the RAF and indeed of Army trainers is likely to continue for some time.”