Several Iraqi Kurdish troops tested positive for mustard gas after battles with ISIL in northern Iraq this summer.
Blood samples from the Kurdish peshmerga fighters sent to a Baghdad lab revealed traces of the toxic gas, said a spokesman for the paramilitary group, Jabar Yawar, on Wednesday.
The exposure took place during the battles along the front lines near the northern Iraqi towns of Makhmour and Gwer, he said.
The blood tests raise the possibility that ISIL used mustard gas in fighting the peshmerga forces.
If confirmed, it would be the latest chemical agent apparently procured and used by the extremist group in the war.
In March, Kurdish authorities in Iraq said they had evidence that ISIL used chlorine gas as a chemical weapon against its fighters.
The allegation by the Kurdistan Region Security Council, stemming from a January 23 suicide truck bomb attack in northern Iraq, followed similar allegations about the militants using the low-grade chemical weapons against Iraqi security forces as well as on Kurdish fighters in Syria.
Iraqi Kurdish troops, trained and helped by American advisers, took the lead in battling ISIL after the extremist group blitzed across much of northern Iraq last year.
Iraqi government forces and allied Shiite militias have since joined the fight, backed by US-led coalition air strikes.
Mr Yawar said forces from the coalition also took blood and soil samples in the same area and that those also tested positive.
However, according to Army Col Steven Warren, the spokesman for the US-led coalition in Iraq, “the field test was not conclusive”.
“We continue to monitor reports of chemical weapon use closely and stress that any use of chemicals or biological material as a weapon would be further evidence of ISIL’s barbarity,” Col Warren said.
According to the peshmerga force, ISIL militants fired some 50 mortar rounds on Iraqi Kurdish positions on August 11.
At least 37 of them exploded, releasing white smoke and a black liquid. Hazhar Ismail, director of coordination and public relations for the Peshmerga Ministry in Erbil said at least 35 peshmerga soldiers tested positive.
“Some still have health problems today, mainly [with the] skin and eyes,” he said. “Nobody got killed in the attack.”
A senior US military officer said in August that preliminary tests showed traces of mustard gas on ISIL mortars.
The government of Iraq’s self-ruled Kurdish region said last month that ISIL militants fired a homemade rocket carrying “chemical substances” at peshmerga forces near the Mosul Dam in northern Iraq.
Mustard gas is a chemical agent that attacks the eyes and skin, causing severe blisters. If inhaled, it can damage the lungs and other organs.
While not usually lethal, exposure to mustard gas is generally debilitating. Kurdish fighters, supported by coalition air strikes, have retaken territory from ISIL spanning across northern Iraq.
However, progress has stalled in recent months as the Sunni militant group held on to locations they view as strategic, particularly towns along the border with Syria.