Dubbed "Vengeance for the Martyrs", the operation will see army, special forces, police and Kurdish peshmerga fighters hunting down IS cells in the centre of the country, Iraq's Joint Operations Command (JOC) said in a statement.

It comes after the bodies of eight IS captives were found late last month along a highway north of Baghdad. Some of the abductees had appeared in a video in which IS threatened to execute them unless Baghdad released female prisoners.

The JOC statement said army, federal police, special forces, peshmerga fighters and the Hashed al-Shaabi paramilitary force had launched "a vast operation to clear out the region east of the Diyala-Kirkuk" highway.

The operation was being supported by the Iraqi air force and the US-led coalition that intervened against IS in Iraq and Syria after the jihadists seized control of large parts of both countries in 2014.

One jihadist had already been killed and eight captured, the JOC said, and equipment including vehicles and bombs destroyed.

The operation marked the first time that federal Iraqi forces and the peshmerga were working together since clashes following last year's Kurdish independence referendum.

Iraq declared victory over IS in December after expelling the jihadists from all major towns and cities in a vast offensive.

But the Iraqi military has kept up operations targeting mostly remote desert areas from where jihadists have continued to carry out attacks.

Prime Minister Haider al-Abadi had vowed to avenge the eight civilians killed by IS and ordered the execution of hundreds of convicted jihadists. Thirteen jihadists on death row were executed last week.