"Dozens of Huthi militia and their allies arrived in armoured troop carriers and entered Al-Maashiq presidential palace," said the senior official, who saw them enter the complex.
Heavy clashes, including tank shelling, erupted afterwards between the rebels and their opponents inside the palace compound, a member of the pro-Hadi militia said.
Hadi fled to Saudi Arabia last week as the rebels bore down on his last stronghold.
The rebel advance into the palace followed heavy fighting between opponents and supporters of Hadi on the streets of the southern city.
At least 44 people -- including 18 civilians – were reported dead on Thursday alone.
Hadi fled to Aden from the capital after Shiite rebels seized power in February.
The palace came under fire from warplanes twice during his stay in the southern city.
Hadi's aides have said he has no immediate plan to return from Saudi Arabia.

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