The Euphrates Valley town of Rawa and nearby villages were bypassed by government troops and allied militia when they retook the town of Al-Qaim on the Syrian border last week.
But today, troops backed by militia recruited among the region's Sunni Arab tribes "launched a major offensive to liberate Rumana and the Rawa area,", General Abdelamir Yarallah said.
He later said they had "retaken Rumana and its bridge on the Euphrates" along with 10 other villages.
Several officers told an AFP reporter in Rumana that Iraqi forces had managed to foil at least two IS suicide car bomb attacks.
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"Troops are continuing their advance," Yarallah said.
Rawa is the last town still held by IS apart from Albu Kamal, just across the Syrian border, where the jihadists were still battling Syrian regime and allied forces today after mounting a surprise counterattack late Thursday.
Prime Minister Haider al-Abadi, who is also head of the armed forces, said today the operation also aims to "clean open areas in the desert" of western Iraq.
Across the border, the Syrian army had declared victory in the battle for Albu Kamal.
But IS fighters pushed back in from the desert to the north where they still control a strip of territory between areas held by government troops and by US-backed Kurdish-led forces.