The Philippines defence force has been battling militants in the city of Marawi since May, and foreign fighters returning from Iraq and Syria are being drawn there.
A little over 100 days since IS began occupying Marawi, reports emerged that the Philippines had accepted Australian's recent offer to help advise and train local troops.
That has been clarified by foreign minister Julie Bishop.
"The President indicated they were open to more support from Australia and other countries, but the detail of it hasn't been specified."
Defence Minister Marise Payne will travel to Manila next week to discuss the conflict, which has so far claimed 750 lives and displaced more than 300,000 people.
Oxfam's Richard Simpson recently returned from evacuation centres in nearby Gilligan City, where many have been forced to live in cramped conditions.
"It's quite tragic because people left thinking it was a normal conflict. That's the problem with Mindanao. People were used to hearing fighting and gunshots. So they left thinking they'd be able to come back to their houses very quickly. People can't access their work or their normal jobs, kids aren't going to school."
Prime Minister Malcolm Turnbull insists the possibility of IS establishing a stronghold in southeast Asia should not be ignored.
"We do not want Marawi to become the Raqqa of southeast Asia. It is vitally in our interests to see that insurgency defeated."
While Mr Turnbull would not speculate on what Australia's measures may include, Foreign Minister Julie Bishop denied it would involve troops on the ground.
"We're talking about advising, assisting and training. This is not about troops on the ground. The Philippines would not accept that and it hasn't been offered."
But Greens leader Richard Di Natale says offering any assistance to President Rodrigo Duterte could expose Australian troops to war crimes.
"We've got grave concerns about committing Australian men and women to a conflict to support a president who has been involved in extrajudicial killings, who's shown no regard for the rule of law."
Australian spy planes are providing intelligence to the Filipino government, however the country's constitution prohibits foreign forces from taking part in combat roles.
Dr Malcolm Davis, from the Australian Strategic Policy Institute, says that could change but it's unlikely to make Australia any more - or less - vulnerable to terror attacks.
"It's better for Australia to be proactive and work with the Philippines and other countries to prevent the spread of IS into south east Asia, than to be passive and watch it spread anyhow."
Labor says it has a track record of offering bipartisan support on national security and counter-terrorism and will await further announcements from the government.
