The Ministry of Peshmerga Affairs said in a statement that the attack caused casualties, but did not confirm the toll.
One Peshmerga colonel said Islamic State fighters were using hit-and-run tactics in night attacks on their positions.
“They avoid holding the ground for longer time … More reinforcement forces were dispatched to the area to prevent further attacks,” the colonel said.
Iraqi security forces units have been mobilized to the area to help the Peshmerga, said an Iraqi military source.
The militant group also took over Luhaiban village in northern Iraq a day after attacking it, security sources told Reuters on Sunday. There was no immediate confirmation from Iraqi authorities.
The two villages are in remote territory claimed by the Iraqi government in Baghdad and the government of the autonomous northern Kurdish region in Erbil where there are regular attacks by Islamic State. But it is a rare incident of Islamic State militants controlling a residential area near a main road, a highway that links Erbil to the city of Kirkuk. (Reporting by Ali Sultan in Sulaimanyiya and Ahmed Rasheed in Baghdad; Writing by Enas Alashray; Editing by Grant McCool and Daniel Wallis)