Authorities in Iraq claim to have retaken the city of Tikrit from Sunni insurgents who captured it two weeks ago after seizing Iraq's second city of Mosul.

An Iraqi military spokesman says helicopter gunships and special forces snipers, backed by thousands of soldiers, have spearheaded the attack against Islamic State of Iraq and Syria (ISIS) insurgents.

Reinforcements have been airdropped into the north of the city and thousands more are said to be on their way, backed by tanks and bomb disposal units. A military spokesman says US advisers are studying targets for possible airstrikes.

If confirmed, the recapture of Tikrit would mark a turnaround in the fortunes of the Iraqi security forces who were routed earlier this month or deserted their posts.

The military claims insurgent morale in Tikrit is collapsing but the city, located about 140 kilometres north-west of Baghdad, has a mostly Sunni population who accuse the Shiite-dominated government of discriminating against them.

Iraqi troops were trying to advance on Tikrit from Samarra to the south, which has become the military's line in the sand against a militant advance southwards towards Baghdad.

Iraqi special forces already have snipers inside Tikrit University who were dropped by air there in a bold operation on Thursday.

Helicopter gunships fired at targets in Tikrit on Saturday and ISIS fighters abandoned Tikrit's governorate building, security sources said.

Iraqi military spokesman Qassim Atta said that 29 "terrorists" were killed on Friday in Tikrit and that militant commanders were struggling because "their morale has started to collapse".

However, the militants were showing resilience and enjoyed the backing of some local Sunni tribes, as well as former ruling Baathists from the era of late Sunni dictator Saddam Hussein - whose hometown was Tikrit - alienated from prime minister Nouri al-Maliki's government.

In other parts of the country such as Jurf al-Sakhar, 85 kilometres south of Baghdad, ISIS militants were on the offensive.

Three police sources said at least 60 ISIS fighters had been killed along with more than 15 Iraqi security forces members, when the militant group launched a major attack on an army camp just east of the city, firing mortars and RPG rounds.

"The ISIS terrorists fired many mortars at the camp and then started their offensive. They managed to break into the camp but could not hold their positions due to army helicopters cover," a police colonel said.

The Archbishop of Erbil in northern Iraq says thousands of Christians have fled villages near Mosul in recent days, after ISIS fighters attacked two large Christian settlements.

Archbishop Bashar Warda says the displaced have sought refuge in the Kurdistan region of Iraq.

"It was really a terrifying situation for them, and they fled their village just within hours, because of the news and the intensity of the situation," he said.

Since early June, the radical ISIS has overrun most majority Sunni areas in the north and west of Iraq, capturing the biggest northern city Mosul and fanning southwards.

ISIS has vowed to re-create a medieval-style caliphate erasing borders from the Mediterranean to the Gulf and they deem all Shiites to be heretics deserving death.

Conflict a fight between humanity and savagery: Khamenei

Iran's supreme leader Ayatollah Ali Khamenei said the Iraq conflict was a "showdown between humanity and barbarian savagery" and criticised Western media for portraying it as a war between Shiite and Sunni Muslims.

Outside powers have often exploited ethnic and religious divisions in Muslim states and "dream of a war between Shiites and Sunnis" that would not happen, he said in Tehran, according to an official statement.

He warned against what he called Western propaganda about "a cast of morons and Saddam Hussein leftovers," apparent references to ISIS and Sunni tribes who once sided with the country's deposed dictator and now fight with ISIS.

"The incident in Iraq is not a war between Shiites and Sunnis," Ayatollah Khamenei said.

"It is a battle between supporters and opponents of terrorism, it's a war between fans of America and the West and those favouring independence for their nation.

"It's a showdown between humanity and barbarian savagery."

ISIS Sunni militants have seized a broad swath of territory in northern and western Iraq in recent weeks in their quest to topple Mr Maliki's government.

Deeming Shiites to be heretics, ISIS militants have posted videos showing executions of government troops upon capture.

Iranian media are rife with reports of other atrocities allegedly committed by ISIS.

Disgruntled Iraqi Sunnis accuse Mr Maliki of excluding them from power, which has prompted some Sunni tribes and former Saddam loyalists to join ISIS's armed rebellion.

Iran is a close ally of Mr Maliki and its official reaction has been guarded as the ruling clergy sought to play down the idea of a showdown between Shiites and Sunnis, who make up the overwhelming majority in the Muslim world.

In his speech, Ayatollah Khamenei characterised the events in Iraq and elsewhere in the Middle East as a Western conspiracy.

Last week, the supreme leader said he opposed intervention in Iraq by the United States or any other country to stop ISIS.

US president Barack Obama has said he would not send ground forces back to Iraq, limiting assistance to military advisers, intelligence and surveillance operations.

ABC/Reuters