President Barack Obama has said the US is prepared to take targeted military action in Iraq if it would help fight a growing threat from extremist militants.
He added that the US is ready to send as many as 300 military advisers to Iraq.
Mr Obama spoke as he gave an update to US operations in Iraq, where al Qaeda-inspired militants have sparked instability.
He said the US is forming joint operations centres in Baghdad and northern Iraq, but emphasised that American combat troops would not be returning to Iraq.
Mr Obama also announced that the US has increased its intelligence, surveillance and reconnaissance operations in Iraq to better understand the threats to Baghdad.
The president stressed that it is going to be hard for the current Iraqi government to resolve the country's crisis unless the government is more inclusive.
Mr Obama stopped short of calling for Iraqi prime minister Nouri al-Maliki to resign, saying it is not the US's job to choose Iraq's leaders.
But he added that whoever is prime minister must make sure all sectarian groups feel they can advance their interest through the political process.