US and Iraqi officials say Islamic State fighters facing defeat in Syria are slipping across the border into Iraq, where they are destabilizing the country's fragile security.

Hundreds likely more than 1,000 militants have crossed the open, desert border in the past six months, defying a massive operation by US, Kurdish, and allied forces to stamp out the remnants of the jihadi group in eastern Syria.

That's according to three Iraqi intelligence officials and a US military official. The officials spoke on condition of anonymity because they were not authorised to comment publicly on intelligence matters.

But indications of the extremist group's widening reach in Iraq are clear from kidnappings, assassinations and roadside ambushes aimed at intimidating the local population and financing the group's extortion rackets.

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