Iraq has bolstered Baghdad's defenses as militants near the capital pressing an assault launched in second city Mosul, Agence France-Presse reported the interior ministry spokesman as saying on Friday.
"We put in place a new plan to protect Baghdad," Brigadier General Saad Maan told AFP.
"The plan consists of intensifying the deployment of forces, and increasing intelligence efforts and the use of technology such as [observation] balloons and cameras and other equipment," Maan said.
He said coordination between security forces had also been increased, Al Arabiya reported.
"We have been in a war with terrorism for a while, and today the situation is exceptional," Maan said.
As two more towns in the Iraqi province of Diyala fell into the hands of insurgents overnight Thursday, the country's highest religious authority for Sunnis warned against labeling the "rebels" as "terrorists" in a statement.
Religious cleric Rafi' al-Rifaee stated that the "free rebels" should not be accused of belonging to terrorist organizations such as the Islamic State of Iraq and Syria (ISIS), and said such allegations will only incite division between these rebels and the cities they are "liberating" from the sectarian Shiite government of Prime Minister Nuri al-Maliki.
Rifaee described what is happening in Iraq as a process to liberate Iraq from Maliki's army, the prime minister whom the militants nickname "the tormentor."
The cleric also accused the Shiite-dominated Iraqi army of not respecting Sunni shrines and Christian holy sites in the country.
Militants from the ISIS and local armed men overran the northern city of Mosul earlier this week and have since pressed south towards Baghdad in an onslaught against the Shiite-led government.
Meanwhile, security sources said the eastern towns of Saadiyah and Jalawla had fallen to the insurgents, as well as several other villages around the Himreen mountains, which have long been a hideout for militants.
Kurdish peshmerga forces deployed more men to secure their political party offices in Jalawla before the insurgents arrived in the town. There were no reported confrontations between them.
The Iraqi army fired artillery at Saadiya and Jalawla from the nearby town of Muqdadiya, sending dozens of families fleeing towards Khaniqin near the Iranian border, security sources said.
On Friday, security forces were also battling the militants on the outskirts of Muqdadiya, 35 kilometers (23 miles) northeast of Baquba, AFP reported police and army officers as saying.
They also clashed with militants advancing on the city of Baquba, just 50 kilometers (30 miles) north of Baghdad.
Baquba is the capital of Diyala province, whose mixed Arab, Kurdish, Sunni and Shiite population has made it a byword for violence ever since the U.S.-led inavasion of 2003.
U.S. President Barack Obama threatened U.S. military strikes against the Sunni Islamist militants who want to establish their own state straddling the border of Iraq and Syria.
The Kurds, who run their own autonomous region in the north, have taken advantage of the chaos to expand their territory, taking control of the oil-rich Kirkuk and other areas outside the formal boundary of their enclave.
Meanwhile, the U.N. refugee agency said Iraq's refugee population has increased by almost 800,000 this year as the government struggles against rebels and Islamic militants.
Hundreds of Iraqi men, women and children crammed into vehicles have fled their homes, fearing clashes, kidnapping and rape after the militants seized large swathes of northern Iraq.
The families and fleeing soldiers who arrived Thursday at a checkpoint at the northern frontier of this largely autonomous Kurdish region in Iraq were among some half-million people who have fled their homes since Monday, according to a U.N. estimate.