The announcement, which will bring the total authorised number of American military personnel in Iraq to more than 4,600, came two days after Baghdad said it had recaptured a base south of Mosul that is seen as an important step toward the eventual battle for the city.
Iraq's second city Mosul has been under Islamic State group control since June 2014, when the jihadists overran large parts of Iraq, carrying out atrocities including execution-style killings, mass kidnappings and rape.
"I am pleased to report today that... We agreed for the United States to bolster Iraqi efforts to isolate and pressure Mosul by deploying 560 additional troops," Carter said at the Baghdad airport following meetings with the Iraqi premier and defence minister.
"With these additional US forces we are describing today, we will bring unique capabilities to the campaign... At a key moment," Carter said.
And while most of the US forces in Iraq are in non-combat roles, others have directly battled IS, and three American military personnel have been killed by the jihadists.
"The additional troops will provide a range of support for Iraqi security forces, including infrastructure and logistical capabilities at the airfield near Qayyarah," the Pentagon said in a statement.
Prime Minister Haider al-Abadi announced on Saturday that Iraqi forces had recaptured the Qayyarah airbase, some 60 kilometres (35 miles) south of Mosul, which IS seized in June 2014.
Lieutenant General Sean MacFarland, the commander of the US-led operations against IS, said that the "preponderance" of the 560 additional troops will be based at Qayyarah, and would start being deployed "relatively soon."
Earlier in the day, Carter held meetings with Abadi as well as Defence Minister Khalid al-Obeidi, offering his condolences for recent IS attacks and congratulations on Iraqi advances.
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