Troops aided by air support attacked several villages on the fringes of the Sambisa forest jihadist stronghold outside the town of Bama, pummeling Boko Haram fighters who had taken over the area, the sources said.
Bukar Grema, an anti-jihadist militia fighter working alongside the military said the militants were overwhelmed and in an effort to escape plunged into the Yezaram river, which was overflowing from heavy rains and drowned.
"Most of the Boko Haram elements drowned in the river and their bloated bodies were found floating on the surface on Saturday," Grema said.
Two residents confirmed the drowning incident.
"More than 100 terrorists were killed, most of them by drowning when they tried to cross the seething river," a senior military officer said on the incident which happened on Thursday through Friday.
"Our troops pulverized the terrorists from ground and air attacks, forcing them to abandon their positions," said the officer, who asked not to be identified because he was not authorized to speak on the incident.
Four soldiers were killed, he said.
The site is 15 kilometers from Bama on the edge of Sambisa forest -- a game reserve which has turned into an enclave for Boko Haram and rival Islamic State West Africa Province,
Boko Haram jihadists seized Bama in 2014 when they took over swathes of territory in northern Borno and declared a Caliphate.
In 2015 Nigerian troops aided by Chadian soldiers clawed back most of the territory after months-long intensive ground and aerial operations.
Residents who had fled returned three years later, with many of them living in camps as the town was substantially destroyed during the fighting to retake it.
The attacks forced residents of villages in the area to move into Bama, which is a fortified garrison town.
Boko Haram fighters have moved into some of the deserted villages, ambushing and killing scrap metal scavengers, loggers and farmers who venture into the bush.
The jihadist violence has killed over 40,000 people and displaced around two million from their homes in the northeast since 2009, according to the United Nations.