The president, who broke his vacation on the Massachusetts island of Martha's Vineyard, told reporters at the White House that progress had been made since he authorised targeted air strikes on IS militants Aug 7, Xinhua reported.
"Over the last 11 days, American air strikes have stopped the ISIL (now known as Islamic State) advance around the city of Irbil, and pushed back the terrorists," he said.
US warplanes began air raids Friday on IS targets near the Mosul Dam, Iraq's largest.
Noting that Iraqi and Kurdish forces recaptured the dam Monday, Obama said "We will continue to pursue a long-term strategy to turn the tide against ISIL by supporting the new Iraqi government and working with key partners in the region and beyond. "
He said Washington had "urgently" provided additional arms and assistance to Iraqi and Kurdish forces fighting on the front lines.
"This operation demonstrates that Iraqi and Kurdish forces are capable of working together and taking the fight to ISIL," the president remarked. "If they continue to do so, they will have the strong support of the United States of America."
The Obama administration joined last week in forcing out Iraqi Prime Minister Nuri al-Maliki, whose policies were blamed for alienating Iraq's Sunnis and Kurds and giving rise to the radical militants. Haider al-Abadi, who won US endorsement as the new premier, is trying to form a new government.
"Over the next few weeks, Dr. al-Abadi needs to complete the work of forming a new, broad-based, inclusive Iraqi government, one that develops a national program to address the interests of all Iraqis," Obama said. "Without that progress, extremists like ISIL can continue to prey upon Iraq's divisions."
He said the US military will continue their limited strikes in northern Iraq and the new Iraqi government can have increased support from the US and other countries.
The US warplanes have conducted a total of 68 strikes on IS targets since Aug 8, with 35 of them in support of Iraqi forces near the Mosul Dam, the US Central Command said Monday.