At a press conference in White House, Obama said he has ordered Defense Secretary Chuck Hagel to prepare "a range of options" as he considers future military action, Xinhua reported.
The president, however, admitted that his administration so far does not have a strategy in combating the militant group that has grabbed large chunks of territories in Iraq and Syria.
Obama said that IS poses an immediate threat to the people of Iraq
"If we can't have a sound military strategy, then the idea that the US or any outside power would perpetually defeat IS I think is unrealistic," Obama said.
"I don't want to put the cart before the horse. We don't have a strategy yet. Some of the news reports suggests that folks are getting a little further ahead of where we currently are," he said.
Obama said that IS poses an immediate threat to the people of Iraq and to people throughout the region, calling for need of strong regional partners.
He said that he was dispatching State Secretary John Kerry to the area to work with U.S. allies.