President Recep Tayyip Erdogan said Monday that Ankara wanted to establish a "safe zone" in northern Syria free of "terrorists", as Turkish-backed rebels pushed ahead in the town of Al-Bab.
He added the area would also require a "no-fly" zone.
"Our objective here is (to establish) an area of at least 4,000, 5,000 square kilometres free from terrorism, to create a safe zone," Erdogan said in a televised speech in Bahrain.
Turkey has repeatedly called for such a zone, which it believes could help to alleviate the burden of accommodating Syrian refugees.
Late last month, US media reported the Pentagon would be given 90 days to draw up a plan to set up "safe zones" which Turkey said it would watch closely.
Ankara launched an ambitious campaign supporting opposition fighters inside Syria last August to clear its southern border of IS elements and to halt the advance of Syrian Kurdish militia.
After a lightning advance retaking northern towns including Jarabulus, it is facing the biggest challenge of the campaign so far in Al-Bab.
Turkish troops and their Syrian rebel allies entered the centre of Al-Bab at the weekend with Erdogan saying its capture was now a "matter of time" on Sunday.
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Opposition fighters captured 40 percent of the town's centre, the official news agency Anadolu reported on Monday, quoting its correspondents on the ground.
Erdogan said the targets after Al-Bab would be Manbij -- a former bastion of IS that is now under the control of US-backed, Kurdish-led militia -- and Raqa if "we take a joint step with (US-led) coalition forces".
Turkey has insisted that any operation to retake Raqa from extremists should be done without the Kurdish Peoples' Protection Units (YPG) militia.
Ankara sees the YPG as a sister "terror" group of the outlawed Kurdistan Workers' Party (PKK) waging an insurgency inside Turkey since 1984.
But Washington views the Kurdish militia as its most effective force on the ground in Syria against IS.
Later on Monday, Deputy Prime Minister Numan Kurtulmus said Ankara would view the Kurdish Democratic Union Party (PYD) and its armed wing YPG replacing IS in Raqa as a "top security threat" to Turkey.
Turkey says it is home to over 2.7 million Syrian refugees who fled the country ravaged by the conflict which began with anti-government protests.
More than 310,000 people have been killed during the six-year civil war.