The capture of Akashat, a former mining town in mainly Sunni Arab Anbar province, some 100 kilometres (60 miles) south of the jihadists' border bastion of Al-Qaim, came just hours after the forces assaulted it.
Al-Qaim and the Euphrates towns of Rawa and Anna downstream form just one of two enclaves still held by ISIS in Iraq after a string of battlefield defeats this year.
"The army, the Hashed al-Shaabi (Popular Mobilisation force), tribal units and the police captured Akashat," the Joint Operations Command leading the fight against ISIS said in a statement.
Earlier, JOC head General Abdelamir Yarallah said the operation "to liberate Akashat" was aimed at securing the border to its north.
The Hashed al-Shaabi are a paramilitary force largely composed of Iran-trained Shiite militias but also including some fighters recruited from Sunni tribes.
Iraqi commanders estimate there are no more than 300 civilian families left in Akashat, a former railhead that was once a major source of phosphate production.
Imad Meshaal, mayor of Rutba, a desert town further south recaptured from ISIS last year, told AFP the jihadists had turned the area into a major hub for arms caches, training camps and command centres.
Iraqi commanders say they estimate ISIS still has more than 1,500 fighters in its Al-Qaim enclave.
The jihadists also control a second enclave west of the ethnically divided Kurdish-held city of Kirkuk centred on the mainly Sunni Arab town of Hawija.
A promised offensive against ISIS there has been delayed by a row over a controversial referendum on Kurdish independence planned for later this month.