Human rights commissioner says there is grave danger the group might opt to kill such vulnerable people rather than see them set free.
Daesh has kidnapped 550 families from villages around Mosul in Iraq, possibly to use them as "human shields," the UN said on Friday. The intergovernmental organisation said it had "verified information" from local contacts.
The group escalated retaliation after Iraqi security forces, with the help of a coalition, launched an operation to rid the city of Daesh fighters on Monday. On Friday, Daesh attacked the oil-rich area of Kirkuk, hours after Iraq's Prime Minister Haider al-Abadi said Iraqi forces were advancing faster than expected in the offensive to liberate Mosul.
"We are gravely worried by reports that ISIL is using civilians in and around Mosul as human shields as the Iraqi forces advance; keeping civilians close to their offices or places where fighters are located, which may result in civilian casualties," UN High Commissioner for Human Rights Zeid Ra'ad al-Hussein said in a statement.
"There is a grave danger that ISIL fighters will not only use such vulnerable people as human shields but may opt to kill them rather than see them liberated," he added.
Daesh forced 200 families to move from Samalia village to Mosul on October 17, UN spokesperson Ravina Shamdasani said. She added another 350 left Najafia village for Mosul on the same day.
Earlier this week, the International Organization for Migration (IOM) warned Daesh may launch chemical attacks and use civilians as human shields as a response to the operations to recapture Mosul.
"Tens of thousands of people may be forcibly expelled, they will be getting trapped between fighting lines under siege, they may even be held as human shields," IOM Iraq chief of mission Thomas Weiss told Reuters.
The UN has also launched an investigation to collect corroborated information on reports that Daesh had killed 40 civilians in one village outside Mosul, Ra'ad al-Hussein said.