ISIS-inspired knock-off Lego is being marketed to Australian children for less than $10.

The counterfeit 'Falcon Commandos' set is being produced in China and sold on at least three overseas websites – including a Chinese discount retailer that ships to Australia.

The set, which depicts ISIS terrorists dressed in black battling counter-terror police, are being sold for $9.91 or less.

U.S. manufacturer BrickArms has produced fake 'Lego' featuring terrorist characters holding guns and rocket launchers (above)

A counterfeit 'Falcon Commandos' Lego set (pictured), which depicts ISIS terrorists dressed in black battling counter-terror police, is being produced in China and sold online

The fake set is being sold on at least three overseas websites – including a Chinese discount retailer that ships to Australia (pictured)

Ads for fake toys show eight mini-figures - the small idividual toys in each set of Lego - on the cover of the set.

On the front cover, what appears to be an ISIS jihadist is seen holding a chainsaw near a man's decapitated head

In the photos, one of the figures appears to be an ISIS jihadi who is holding a chainsaw while looking at a man's decapitated head at his feet.

An ISIS flag also appears to be pictured, as well as sticks of dynamite and figures launching weapons.

The set is 'recommended' for children aged six and over and was recently purchased accidentally by a young boy from a store in Taiping for $2, according to Berita Harian.

The toy's serial number came back to a manufacturer in China, the publication reported.

An ISIS flag is also believed to be pictured, as well as sticks of dynamite and figuring launching weapons (pictured)

Mahnun Mat Isa, a 40-year-old Malaysian mother and school teacher, told Berita Harian she has reported the set to the Islamic council and to police officers.

'I ask the authorities to not freely allow the entry of toys that touch on religious sensitivities in this country,' Ms Mahnun said.

'I came to know about it when my son who was playing with the toy showed me the 'terrorist' character holding a banner which displayed the words 'Allah' and 'Muhammad'.'

Daily Mail Australia has contacted Lego for comment.