“Look at the little children,” the gun-toting militant tells the camera, bouncing a child on his hip. “They’re having fun.”

A new Islamic State of Iraq and al-Sham (ISIS) propaganda video featuring an alleged American citizen has been released online, underscoring the deepening concerns over the Western fighters flocking to Syria to take up arms.

Released to celebrate the Eid al-Fitr holiday marking the end of Ramadan’s month-long fast, the video doubles as a recruitment tool for the militants who recently declared a caliphate, or Islamic state, across a swath of territory stretching from Syria into Iraq.

Text bearing “Eid Greetings from the Land of Khilafah” pops up throughout the video. Most of the 20-minute release, however, features fighters claiming to be from countries including Finland, Belgium, Indonesia, South Africa and the U.S. urging their countrymen to come join them and reap the benefits of living in the caliphate.

“I’m feeling like I’m still dreaming - I’m thinking like I’m in a dream world,” the so-called American fighter says. He is identified in the video as Abu Abdurahman al-Trinidi, an American, but whose nom de guerre suggests he at least spent time in or originated from Trinidad.

“You have to be here to understand what I’m saying,” he adds, amid a sea of guns. “If you stay away you will not understand.”

It’s not clear where exactly the video was taped, though the fighters make reference to "the land of Sham," a term used to describe Syria and portions of neighboring countries. When asked about the video on Monday, the State Department said it was looking into the matter.

The threat of radicalized and battle-hardened Westerners returning from Syria and Iraq to carry out attacks on their home soil has been deemed the biggest security challenge for counter-terrorism officials since the 9/11 attacks. While the exact number of foreign fighters associated with ISIS is unknown, two recent studies put the figure above 10,000 - with about 3,000 coming from Western European countries.

That includes “dozens of Americans,” according to Attorney General Eric Holder. He recently described the proliferation of foreign fighters as “a global threat in need of a global solution” and stressed that the world “cannot simply sit back and let it become a training ground from which our nationals can return and launch attacks.”

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Experts say the rapid advance of ISIS has created an online buzz that is “very attractive” to potential foreign fighters – and the release of slick propaganda videos featuring English-speaking jihadists are part of a sophisticated media strategy aimed at boosting the ranks of those fighters.

“Believers – all Muslim world – please. This is a call for you,” the alleged American says in the latest video. “Look all the little children, they are having fun.”

The video he features in was released Saturday and bears the stamp of the Al Hayet Media Center. While Al Hayet is not formally associated with ISIS, it is one of a few media organizations promoted by the militants on their own social media accounts.

“The significant thing about it seems to be that there are a raft of people from so many nations,” said Raffello Pantucci, a senior research fellow at the London-based Royal United Services Institute, citing other recent releases of videos featuring Britons and Australian fighters. “They’re very keen to emphasize the fact that they’ve got a really multinational group that is fighting for them, that they’re building a real caliphate, that this is a truly global movement and therefore should draw people from around the world.”

One of the men pictured in the video released Saturday identifies himself as British and says in English that he doesn’t “think there’s anything better” than life in the caliphate.

“You’re not living under oppression ... You’re living by the Quran,” he tells the camera in English. “As Muslims that’s all we want and that’s all we need. We don’t need any democracy, we don’t need any communism, we don’t need anything like that – all we need is Shariah [Islamic law]."

While some analysts recognized that British fighter from Twitter, the majority of the faces in the latest video appear to be new to the propaganda machine and part of a deliberate attempt at demonstrating the group’s reach.

“The fact that there are new faces is important in that it kind of serves as a constant reminder that it’s very difficult to keep track of who’s over there and who’s going over there,” said Charlie Cooper, a researcher at the Quilliam Foundation, a London-based anti-extremist think tank. “They’re going to show off about the foreign fighters they do have, particularly the ones from the West, because that’s most valuable. It's more exciting and more of a coup if they get someone who is from America or the U.K.”

Western intelligence and law enforcement have stressed the difficulty in tracking fighters traveling to and from the U.S. and Syria - a point underscored by the release last week of video showing the first American believed to have carried out a suicide attack in Syria. That video – released by the al Qaeda-backed group al-Nusrah Front – purports to show Moner Mohammad Abusalha burning his passport and issuing threats against the West.

Law enforcement officials have told NBC News that Abusalha was able to travel back and forth between the U.S. and Syria, visiting Florida for several months in 2013 in attempts to recruit friends as fighters.

About 300 fighters have already returned to Britain from Syria, according to officials. Some fighters already have carried out attacks in Europe - a French national who fought in Syria is suspected of killing four tourists at the Jewish museum in Brussels in May - while dozens of arrests have been made of individuals accused of receiving training on the battleground and recruiting fighters for ISIS.

English speakers, in particular, are of “immense propaganda value” to ISIS, according to Cooper.

“To have someone who is allegedly a U.S. citizen calling for others to come to the caliphate is a big thing,” said Cooper. “Its a propaganda coup.”

Still, Cooper noted that ISIS appear to be taking a dual-track approach to the propaganda - some videos aimed at fighters, others aimed at encouraging all Muslims - not just fighters - to come to the caliphate and populate the Islamic state.

“In my whole life I never felt like a Muslim as I do now,” a fighter with the nom de guerre Abu Hanifah al-Belgiki - reportedly from Belgium - tells the camera in the latest release. “We are living here wonderfully in great happiness. We actually can wish for nothing more.”

Smiling and laughing children flash on the screen, riding merry-go-rounds and playing bumper cars - all part of projecting the idea that ISIS has created a utopia for Muslims and all should come.

Another fighter claiming to be South African points to the little girl in his arms, his fifth daughter, as he stresses that “there is no place in the world at the moment where you will have such safety” for family.

A man with what appears to be ammunition strapped to his chest distributes toys to flocks of small children, who grab then wave their toy water pistols in the air excitedly as a teen waves the black banner of ISIS next to them.

As the video draws to a close, the message is spelled out clearly, in delicate cursive: “I wish you were here.”

Pete Williams, Cynthia McFadden and Robert Windrem of NBC News contributed to this report.