The IS rebels took the cities of al-Hamdaniya and Telkif, north of Mosul, after defeating the Kurdish Peshmerga forces who controlled the area, the sources told Efe news agency.
The Islamic extremists also captured Bertala, al-Kuir and Ba'shiqah, inhabited both by Muslims and Christians, near Erbil, the capital of the Iraq's Kurdistan region.
Thousands of families abandoned their homes and fled to neighbouring Kurdistan in search for a safe haven, the sources said.
The IS took control of Mosul, Iraq's second largest city, last June, and since then it has advanced to other regions including Sinjar, making it closer to the last border crossing with Syria which it does not control.
The IS has seized large parts of Iraq and Syria to create an Islamic caliphate and has warned Christians they should convert to Islam or leave.
The rebel takeover of Sinjar three days ago led some 200,000 civilians to flee to the nearby mountains, mostly Kurds of the religious Yazidi community.
The refugees, who are trying to reach Kurdistan, urgently need water, food, shelter and medicines, the UN's Office for the Coordination of Humanitarian Affairs (OCHA) spokesman David Swanson told Efe.
According to OCHA, since January 2014, the surge in violence between government forces and armed groups has displaced 1.2 million people in central and northern Iraq.
According to an earlier Xoinhua report, the latest fall of towns into the hands of the militants came amid fierce clashes between the Kurdish Peshmerga security forces and Islamic State militants.
The Kurdish Peshmerga forces have launched a major offensive to fight back the IS militants who seized earlier many towns in Nineveh.
The Peshmerga has since retaken control of some villages and part of Sinjar, but so far the Kurds have apparently failed to take full control of the town and the other areas seized earlier by the IS militants.
On Tuesday, the United Nations Children's Fund (Unicef) said in a statement that up to 40 children from displaced families of the Yazidi minority, who have moved to a nearby mountain, were reported to have died.
"According to official reports received by the Unicef, these children from the Yazidi minority died as a direct consequence of violence, displacement and dehydration over the past two days," the statement said.
The battlefields of Talkif, Qaraqoush, Sinjar are part of disputed areas which are ethnically mixed with Kurds, Arabs, Turkmens and others.
The Kurds have demanded expansion of their autonomous region in northern Iraq to include the oil-rich province of Kirkuk and other areas in the Iraqi provinces of Nineveh, Salahudin and Diyala, but their move is being fiercely opposed by the central government in Baghdad.
Early in June, the Peshmerga took control of the disputed areas, including the northern city of Kirkuk after the Iraqi security forces abandoned their bases following the IS's June 10 blitzkrieg across Iraq in which the Al Qaeda offshoot and other Sunni militant groups seized large swathes of territories in predominantly Sunni provinces.