BAGHDAD - Iraqi soldiers backed by Shi'ite militia and Kurdish peshmerga forces attacked two towns northeast of Baghdad held by Islamic State fighters on Sunday, trying to clear a main road linking the capital to the border with Iran.
Peshmerga and army officers said they advanced into Jalawla, 115 km (70 miles) from Baghdad, and the nearby town of Saadiya, which they have been trying to recapture from Islamic State since the radical Islamists seized them in August.
Ten soldiers, peshmerga and militia fighters were killed and 32 were wounded in Sunday's fighting, a source at Khanaqin Hospital told Reuters. There were no immediate casualty figures for Islamic State fighters.
Iraq's Shi'ite-led government, backed by US-led air strikes, has been trying to push back the Islamic State since it swept through mainly Sunni Muslim provinces of northern Iraq in June, meeting virtually no resistance.
Last week the army broke a months-long siege of the country's largest refinery north of Baghdad, but Islamic State fighters continue to take territory in the western province of Anbar, which shares borders with Syria, Jordan and Saudi Arabia.
Islamic State militants have been fighting in the last two days to take full control of the Anbar's provincial capital Ramadi.
Jalawla and Saadiya are located in Diyala province which is mainly under the control of the Baghdad government forces and Kurdish peshmerga.
A senior peshmerga official said the Islamic State presence in Jalawla threatened the Kurdish-controlled towns of Kalar and Khanaqin to the north as well as nearby dams and oil fields.
Recapturing the town would also allow the road to be reopened between Baghdad and Khanaqin, close to the Iranian border, peshmerga Secretary-General Jabbar Yawar said.
While the hardline Sunni Islamic State forces have not advanced into Baghdad, they hold a ring of towns around the mainly Shi'ite capital and have claimed responsibility for a series of bombings in Shi'ite districts of the city.
A car bomb in the Shi'ite town of Yousufiya, 30 km (20 miles) southeast of Baghdad, killed five people on Sunday, police and medics said.