The refinery was under seige the past 10 days, BBC reported.
After announcing the capture, the militants offered Iraqi troops safe passage provided they gave up their weapons.
Baiji refinery in Salahuddin province is Iraq's largest and produces a third of Iraq's refined fuel and the battle has already led to petrol rationing.
According to an ISIS spokesman, the capture of the refinery is essential as the militants can keep control of the captured regions and supply Mosul with energy ahead of advancing towards Baghdad.
The militants Sunday captured two key border crossings of al-Waleed, on the Syrian frontier, and Turaibil, on the Jordanian border in Anbar province after government forces pulled out.
The ISIS militants Friday captured the towns of Qaim, Rawah, Anah and Rutba also in the Anbar province.
According to security officials, 70 percent of Anbar province is now under the control of the militants.
US Secretary of State John Kerry arrived in the Iraqi capital of Baghdad Monday for talks on the situation in the violence-hit country.
Kerry met Iraqi Prime Minister Nouri al-Maliki and also held talks with key Shia and Sunni figures.
The US, which pulled out of Iraq in 2011, is deploying some 300 military advisers to Iraq to help in the fight against the insurgents.