As far as sending SAS personnel, Mr Key said: "I can't rule that absolutely out, but what I can say is that I'll get advice and we'll see how that goes, but it would be my least preferred option."
Any commitment of personnel "would be a step I think we should take very cautiously and with our eyes open because history tells you that going into places like Iraq is fraught with difficulty and danger and as we know with Afghanistan, it was a very long-term commitment".
Afghanistan had shown such commitments were neither easy nor shortlived and the sophistication of Isis was greater than the al- Qaeda-linked Taliban there.
"These are not insignificant people. Their acts of brutality are grotesque and most New Zealanders would be deeply offended by what they see."
Mr Key said the SAS, who had intelligence gathering and training roles in Afghanistan, were not on standby for deployment at this time, but 3 News last night reported that a squad of 12 SAS personnel were in "pre-deployment mode" for a possible mission in Iraq.
Mr Key again emphasised that involvement in Iraq, where the Government had asked for international help, was more likely than in Syria, where that was not the case.
Despite his clear reluctance for New Zealand to get involved in military operations, Mr Key said he was of the view that airstrikes on Isis targets "will only take you so far".
He was also taking advice on whether New Zealand would follow Australia and begin publicly notifying its threat level.
What is Isis and Isil?
Isis (Islamic State in Iraq and Syria) is one of several names for the former "al Qaeda in Iraq" militant group, which has also gone by the titles Isil (Islamic State in Syria and the Levant) and simply Islamic State.Who are they? According to the CIA, Isis has more than 30,000 fighters, about half of them foreign, including at least 2000 who hold Western passports.
What do they want?
To establish a caliphate, or strict Islamic state, across northern Syria, Iraq and beyond.
Are they succeeding?
Isis has made major gains in Iraq, seizing its second-biggest city, Mosul, and threatened to overrun parts of the Kurdish regional government.
Why should the world worry?
Isis has been accused of ethnic cleansing and committing war crimes, such as public executions and recruiting child soldiers. The group has executed hundreds of local captives, American journalists James Foley and Steven Sotloff and British aid worker David Haines.
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