The U.S. -led coalition fighting ISIS is investigating reports of an airstrike in a western neighbourhood in the Iraqi city of Mosul that allegedly left more than 100 civilians dead last week, according to a statement given to The Associated Press on Friday.

The US-led coalition on Saturday admitted to carrying out air raids last week at a location in west Mosul where scores of civilians were reportedly killed. Almost 600,000 people are feared to be trapped in the warzone with severe crisis of food, water, medicines and other essentials leading to a grave humanitarian crisis, Reuters wrote, citing aid agencies.

As of March 14 of this year, the US alone has carried out over 7,700 airstrikes in Iraq - many centered around the ISIS stronghold in Mosul - while coalition forces have conducted an additional 3,634 airstrikes in the war-plagued Middle Eastern nation.

"They (Iraqi forces) are looking at opening another front to force ISIS to fight on two directions and isolate the Old City, so when it is time to go into the old city, potentially they surrender", he told Reuters.

Residents of west Mosul fled fighting in the city on Thursday, and as the battle rages in the area around the old city, the situation for civilians has become unbearable.

The investigation is one of several opened this week amid reports of large civilian casualties due to USA airstrikes.

"We are stunned by this bad loss of life and wish to express our deepest condolences to the many families who have reportedly been impacted by this tragedy", Lise Grande, the UN's humanitarian coordinator for Iraq, said in a statement. "Most of (those) killed are civilians, among them children and women", he said.

Residents escaping besieged western Mosul have told of Iraqi and US -led coalition air strikes demolishing buildings and killing civilians in several cases.

ISIL fighters had been positioning auto bombs, and forcing residents to move furniture into the streets which the militants were booby-trapping to slow Iraqi advances.

The US has opened an investigation into claims it killed dozens of innocent people while carrying out an airstrike targeting so-called Islamic State in Mosul.

But families are streaming out of the northern city, Iraq's second largest, in their thousands each day, headed for cold, crowded camps or to stay with relatives.

Separately, a United States defense official told CNN the military is trying to determine how many civilians were killed in the Mosul strikes and how it may have happened.

But in the built-up urban areas, civilians are bound to be hit, and temporary field hospitals around Mosul are filling up with those wounded in the fighting.

The militants have used vehicle bombs, snipers and mortar fire to counter the offensive.

"Nothing in this conflict is more important than protecting civilians".