The battle for the town of Gwer demonstrates the Islamic State group's ability to still launch offensives in Iraq, despite a month long campaign of airstrikes by a US-led coalition.
And while an alliance of Iraqi troops, Kurdish fighters and Sunni and Shiitte militiamen have made some gains, their advance remains tenuous at best.
The fighting began yesterday as the extremists approached Gwer, just outside of the northern city of Mosul, which the Islamic State group controls, said Halgurd Hekmat, a spokesman for Iraqi Kurdish forces in Irbil.
Backed by US-led airstrikes, Kurdish forces retook Gwer in August after the Islamic State group's offensive saw it seize a wide swath of Iraq.
Kurdish fighters from Iraq also have deployed in small numbers to help Syrian Kurds battle the group's fighters in the Syrian border town of Kobani.
Gwer sits near Irbil, the Kurdish regional capital. Retaking it would allow Islamic State group fighters a new base to potentially launch assaults targeting the city.
Earlier this month, peshmerga fighters also retook small villages around the militant-held town of Sinjar, opening a corridor to help hundreds of Yazidi families atop nearby Mount Sinjar.
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