Australia's announcement comes as the government of the Philippines declares victory against IS militants in the southern city of Marawi.
Australia will send approximately 80 troops to the Philippines to train its military in urban warfare and counter the "brutal tactics" used by terrorists.
Defence Minister Marise Payne announced the training during a visit to Manila for talks with her south-east Asian counterparts on Tuesday.
"The ADF will provide mobile training teams that will begin providing urban warfare counter-terrorism training in the Philippines in the coming days," Senator Payne said.
"This training will be conducted on Philippines military bases. It will involve a range of skills related to combat in urban environments. It will involve information sharing and experience sharing."
The Philippines has declared an end to five months of fierce urban warfare in the southern city of Marawi held by pro-Islamic State militants.
Philippine Defence Secretary Delfin Lorenzana thanked Australia for its contribution of two spy aircraft and intelligence sharing.
"From the start, Australia has been providing invaluable support," he said during a joint appearance with Senator Payne.
"The fight against global terror cannot be addressed by one country alone and we are very much appreciative of Australia's support for our counter-terrorism program."
An Australian Navy patrol boat will visit the Philippines next month to train naval counterparts.
Senator Payne said both nations will expand reconnaissance, surveillance and information sharing with each other to "combat this terrorist threat over the long term".
"All of the nations in the region and further afield have to learn from what's happened here recently."
There are fears that the Philippines and other south-east Asian nations could become a beacon for IS militants and returning foreign fighters as the self-declared caliphate loses territory in Iraq and Syria.
Australia and the Philippines will also co-host a summit on post-conflict rehabilitation.
Australia will also provide assistance to the Philippines on countering IS militants propaganda on social media.
The ADF is providing similar training to the military and security forces of Iraq and Afghanistan