The Islamic State (Isis) is establishing a number of training camps in eastern Libya, according to the head of the US Africa command.
General David Rodriguez revealed that "a couple of hundred" IS militants could be attending the camps at various sites.
He added that the US was monitoring the camps "carefully to see how it develops" but ruled out any military action.
"It's mainly about people coming for training and logistics support right now, for training sites," he said. "Right now it's just small and very nascent and we just have to see how it goes."
Following the ousting of Muammar Gaddafi in 2011, tribes and militias have been battling for power with many rebel fighters travelling to Syria to fight with jihadist groups before returning.
In a rare audio address last month, the terror group's leader Abu Bakr al-Baghdadi formally welcomed several new groups which had pledged loyalty to his "caliphate" into the IS fold, including Libyan militants.
IS militants have also seized control of the Libyan city of Derna on the Mediterranean coast as the group's influence spreads across North Africa.
The city holds a population of about 100,000 and is close is close to the Egyptian border, and about 200 miles from the shores of the European Union.
The country's second biggest city, Benghazi, is also in the hands of Islamists while the country's parliament is now based in the eastern town of Tobruk.