The sources, including an Afghan general and a provincial governor, said a man identified as Mullah Abdul Rauf was actively recruiting fighters for the group, which controls large parts of Syria and Iraq.
Gen Mahmood Khan, the deputy commander of the army's 215 Corps, said that within the past week residents of a number of districts in the southern Helmand province have said Rauf's representatives are fanning out across the province to recruit people.
But he said the Taliban, which is active across Helmand and controls some districts, have warned people not to contact Rauf.
Rauf was a corps commander during the Taliban's 1996-2001 rule of Afghanistan, according to Amir Mohammad Akundzada, the governor of Nimroz province neighbouring Helmand, who said he is related to Rauf but has not seen him for almost 20 years.
Both Khan and Akundzada said Rauf was arrested after the fall of the Taliban in the US-led invasion of Afghanistan and was detained for years at Guantanamo Bay.
"There are reports that 19 or 20 people have been killed" in fighting between the Taliban and the IS group, he added.
Some parts of Helmand have seen fierce fighting between the Taliban and Afghan security forces since US troops pulled out more than six months ago.
A video released online Saturday purports to show militants from both Afghanistan and Pakistan pledging support to IS.
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