"The government agreed to send a military contingent as part of a NATO mission to Iraq, where they will serve from June 1, 2005 until September 30, 2006," Boglar Laszlo was quoted as saying by MTI news agency after a cabinet meeting.
She said the non-combat troops would help provide security to a NATO training base on the outskirts of Baghdad.
The alliance aims to train around 1,000 senior Iraqi military officers a year at the base, but even though NATO approved the mission in June, some of its members -- divided still over the war -- have refused to allow their officers to be sent to Iraq.
Laszlo said the cabinet rejected a NATO request for the troops to also carry out logistics work there.
Hungary currently has 300 soldiers serving in Iraq as part of the US-led coalition, and their mandate runs out at the end of the month.
Parliament in November voted against extending their mission until March 2005, as requested by the Socialist-led government. The government does not need the permission of the legislature to contribute troop to NATO missions.