"The aim (of the operation) is to secure the Baghdad-Kirkuk road and the centre of the Daquq district and to end activity by (IS) members," said Mohammed Mustafa Hama, a brigadier general in the autonomous Kurdish region's peshmerga forces.
Hama said that bombs had killed seven peshmerga and wounded 16 during the operation, figures confirmed by a second Kurdish brigadier general who declined to be identified by name.
The second officer said the operation was launched at dawn today with support from international coalition aircraft, and had succeeded in retaking 10 villages from IS.
IS overran large areas of Iraq in a devastating offensive in June 2014, sweeping security forces aside, and drove Kurdish forces back towards their regional capital that August.
A US-led coalition began carrying out air strikes against the jihadists and Kurdish forces have since pushed the jihadists back, as have Iraqi federal forces in other areas.
But much of western Iraq remains under IS control.