But Mr Peters said the scale and nature of Defence Force activities suggested they had already been instructed to prepare for deployment.
"You don't pull all these forces from their other camps, give them extra-special training, you don't give them new armour which is highly expensive on the basis of 'you may or may not be going'."
A Defence Force spokesman would not provide any detail about its exercises or confirm whether Mr Peters' claims were accurate.
The spokesman said the military had made its own determination to prepare troops "for possible deployment to the Middle East" and this was not at the Government's instruction.
Mr Peters was concerned that the Government was waiting for Parliament to finish for the year before "dumping" the news of a deployment to the Middle East.
Four military personnel have been sent to the Middle East to prepare advice for ministers on a possible humanitarian, intelligence or training role for troops. They were likely to report back in January or February.
If the Iraq Government requested help from New Zealand, a joint Australasian effort was likely, with New Zealand contributing between 40 and 100 personnel. The Government has ruled out a combat role in the fight against Islamic State.