Deployed following requests from the Iraqi and US Governments for contribution to the international building partner capacity (BPC) mission in Iraq, the contingent would be based at Taji, north-west of Baghdad, and are expected to start their mission in May.
Comprising a force protection element and command and support elements, the force would work closely with soldiers from the New Zealand Defence Force, who will participate in the international BPC mission, alongside forces from the US, Spain, Italy, Germany, Denmark and the Netherlands.
In a joint statement with defence minister Kevin Andrews, Australian Prime Minister Tony Abott said the joint operations involving Iraqi security forces and coalition partners have succeeded in halting IS’s onslaught.
The Iraqi forces now require international training support to conduct effective offensive operations against the militants and ultimately assume responsibility for their country’s security, Abott added.
Australia already deployed an Air Task Group and Special Operations Task Group to support the US-led international coalitions to counter IS in Iraq in 2014.
New Zealand Prime Minister John Key was quoted by TVNZ as saying: "I think it shows you the level of commitment that Australia has.
"They’ll now have potentially 900 people in Iraq. New Zealand will have about 106, up to 140-odd at the very maximum.
"It’s very important that there’s a critical mass to allow us to do the job properly of training those Iraqi forces."
The move comes a day after the Iraqi Army launched a large-scale offensive to reclaim Tikrit from IS, which currently controls a large territory in Iraq and Syria.
Supported by Sunni and Shiite militia fighters, as well as airstrikes by the Iraqi helicopters, the government forces have retaken some districts around Tikrit, which fell to the terrorist group in June last year.
The offensive, which reportedly involves 30,000 fighters, is not supported by the US and its allies, who are conducting airstrikes against the group in Iraq and Syria since last year.
Undisclosed security sources confirmed to BBC News that the pro-government forces reclaimed the city’s northeastern district of al-Tin and the western district of al-Abeid.