"I am not going to discuss operational details; however, it is incorrect to say we have SAS calling in airstrikes, or involved in any other combat operations in Iraq," Brownlee said this afternoon.
British newspaper The Guardian reported last night that British, Australian and New Zealand SAS were all active in northern Iraq.
They were working with US forces, the report said, "where they have been calling in airstrikes to support both Kurdish and Iraqi advances".
"Their role at the frontline has not been well documented, however."
Brownlee reiterated Prime Minister John Key's previous public statements on the issue, saying the Government had ruled out sending SAS or any troops into combat roles in Iraq.
"We have also been clear that special forces could be deployed for short periods - for example, to provide advice on issues like force protection or to help with high profile visits, as they have many time before," Brownlee said.
It is not clear whether the SAS are in the region in a non-combat capacity.
The minister has been asked for further comment.
New Zealand has around 140 troops at Taji Military base near Baghdad, where they are training Iraqi forces and federal police behind the wire.
The two-year deployment was extended for another 18 months in June.
A small number of New Zealand troops are also stationed at Besmeya military base, 52km from Taji.
In February, the United States asked all countries including New Zealand to consider sending special forces to assist the fight against the Islamic State (Isis).
Key declined the US request, which came from Secretary of Defence Ash Carter.
"We don't see that fitting with what we are doing," Key told reporters at the time.
He said the Iraqi Prime Minister Haider Al-Abadi had made it clear that his government did not want New Zealand to deploy SAS troops.
"They want their troops trained and they actually want to fight their own battles."
SAS troops were previously used during New Zealand's deployment to Afghanistan, where they fought alongside local police forces.