The announcement comes amid inflamed tensions as US forces have repeatedly struck Iran-backed groups in Iraq and Syria in response to dozens of attacks on bases hosting US and coalition troops in both countries.

The attacks have been fuelled by the war in Gaza between Washington ally Israel and the Iran-backed Palestinian Islamist movement Hamas.

The two countries agreed to form working groups that would eventually lead to formulating "a specific and clear timeline... and to begin the gradual reduction of its (the coalition's) advisers on Iraqi soil", Iraq's foreign ministry said.

The ministry said the timeline would be contingent on evaluating the "threat posed by IS and its danger" as well as the "reinforcement of the capacities of the Iraqi security forces".

In a statement, US Secretary of Defense Lloyd Austin confirmed meetings "in the coming days" to discuss the "transition" of the coalition based on the outcomes of the Joint Security Cooperation Dialogue held between the two countries in August.

The meetings would "determine how the Coalition's military mission will evolve on a timeline" based on factors including the threat posed by IS, "operational and environmental requirements," and the capability levels of Iraq's security forces, the statement said.

There are roughly 2,500 US troops deployed in Iraq and about 900 in Syria as part of the anti-IS coalition launched in 2014.

The US strikes on Iran-backed groups on Wednesday sparked condemnation from Baghdad, with Prime Minister Mohamed Shia al-Sudani calling on the coalition to leave the country.