According to Iraqi official, After US officials announced on the possibility of ISIS Chemical attack, people decided to flee their homes on mass scales.
Iraqi official ask people of Mosul to stay indoor.
Iraqi authorities have called on people to remain in their homes, but are also preparing humanitarian corridors for them to escape the fighting.
Save the Children said on Wednesday that 5,000 people have arrived at the Al Hol camp in northeastern Syria from the Mosul area in the last 10 days, with 1,000 more waiting to enter at the border.
The group says the camp was ill-equipped to receive the refugees, saying it is "littered with waste and feces, with a looming risk of outbreaks of disease." It says there are just 16 latrines shared by more than 9,000 people, many of whom only have access to dirty, untreated water.
Tarik Kadir, head of Save the Children's response to the Mosul crisis, says that "conditions there are among the worst we've seen, and we expect thousands more people to be on their way soon."
Mosul, which fell to the Islamic State group in 2014, is still home to more than a million civilians.
A Turkish official says between 100,000 and 400,000 people could flee the fighting in Mosul and make their way toward Syria, Iraq's Kurdish-administrated region or the border with Turkey, AP reports.
More than 3 million people already displaced internaly in Iraq, officials would struggle to cope with the exodus.
Kinik says his organization was working with officials in northern Iraq and the Iraqi Red Crescent to help support humanitarian efforts there. Some 20 Turkish aid trucks had been dispatched to the region.
New camps for up to 20,000 families are under construction by international aid agencies in northern Iraq and could be ready within a week.
The Turkish official said he believes the refugees would mostly be "taken under control" within Iraq, but added that Turkey is prepared for a refugee influx.
A senior Iraqi military commander has called on local fighters with the Islamic State group inside Mosul to lay down their weapons as a wide-scale operation is underway to retake the city.
Lt Gen Talib Shaghati, told reporters at a military base on Tuesday that up to 6,000 ISIS fighters are still inside the city. He did not say how many of them are foreigners.
The push to retake Mosul is the biggest military operation in Iraq since US troops withdrew in 2011.
Iraqi and Kurdish authorities are setting up a refugee camp with some 5,000 tents east of Mosul as they brace for an influx of people fleeing a massive offensive to retake the Islamic State-held city.
Islamic State militants have deployed suicide car bombs and fired mortar rounds to slow down the advance of Iraqi troops outside a key town near the militant-held city of Mosul.
An officer with the Iraqi army's 9th Division told The Associated Press on Wednesday that his troops are around 1 kilometer (half mile) away from Hamdaniyah, a historically Christian town also known as Bakhdida.
He says ISIS has sent 12 car bombs since Tuesday, all of which were blown up before reaching their targets. He says troops suffered a small number of casualties from the mortar rounds, without providing figures.
Iraq launched a massive operation on Monday to retake Mosul, the country's second largest city.
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