"We can fully expect that as this road towards Mosul progresses, ISIL is likely to try to use it again," Pentagon spokesman Jeff Davis told reporters, using another acronym for the IS group.
Davis said that the jihadists had already used mustard gas "at least a couple dozen" times, packing a "rudimentary" form of the chemical weapon into crude, makeshift munitions.
According to the spokesman, the IS group's mustard gas is typically a powder bound together with tar.
Iraqi security forces, backed by US-led coalition air power, are in the final weeks of preparing operations ahead of an assault to recapture Mosul, which the IS group seized in 2014 and which remains the jihadists' last main stronghold in Iraq.
The Pentagon suspects that the IS group used mustard gas last week in a rocket launched against US soldiers at a base near Qayyarah, a northern town in Iraq considered strategic for retaking Mosul.
The base is in the process of being transformed into a logistics hub to support the Mosul offensive.
All US soldiers in Iraq who may be exposed to IS chemical arms have received training and the necessary protective equipment, Davis noted.
"They have practiced it many, many times before they will ever get to a place like Qayyarah West where they could encounter it," he said.
The United States also has provided more than 50,000 gas masks to the Iraqi forces, he said.
"We want to make sure that the Iraqi security forces and the Peshmergas (Kurdish fighters) have the ability to detect this and to defend against it," he said.
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