Islamic State militants are suspected of firing a shell loaded with a chemical agent during an attack on USA and Iraqi troops in northern region, a Pentagon spokesman said.
The Pentagon also maintains up to 1,500 additional U.S. forces that it doesn't acknowledge as part of its Iraq force, most at the U.S. Embassy in Baghdad or on temporary assignments.
However, another officials said: "I don't know of a case like this where it was proximate to USA forces like this before".
No service members showed signs or symptoms of mustard exposure.
The U.S. official who described Tuesday's rocket attack said "hundreds" of U.S. troops are there, but he would not be more precise.
No U.S. troops were hurt in Tuesday's rocket attack.
That fight is expected to begin as early as mid-October, U.S. officials have said.
One official said the agent had "low purity" and was "poorly weaponized", CNN reported.
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The first test was positive and the second was negative.
Iraqi security forces, backed by coalition air power, are in the final weeks of "shaping" operations ahead of an assault to recapture Mosul, which ISIS seized in 2014 and which remains the jihadists' last main stronghold in Iraq.
The US military has used air strikes to repeatedly hit Islamic State's chemical weapons stores, and experts have warned that the militant group might use the agents during the upcoming Mosul offensive.
Troops stationed at the base are equipped to deal with chemical attacks. Several hundred United States troops are using the base as a staging area for supporting Iraqi forces.
"Our concern is not much greater after seeing this", he said, according to AFP.
Earlier this month, USA warplanes bombed buildings near Mosul that were used to produce lethal chemicals, including chlorine and mustard gas.
U.S. officials emphasized that mustard agent is relatively easy to produce, and they continue to hit suspected manufacturing sites when they find them.