On Tuesday, Vice Chairman of the Joint Chiefs of Staff Adm. James Winnefeld approved the funding, which was drawn from other DOD coffers, according to Pentagon press secretary George Little.
That 90-day stipend, he added, will be a "temporary bridge" until DOD number crunchers submit their budget proposal for fiscal 2013 early next year.
Little said the funding transfer was not a "zero-sum trade," noting that ongoing U.S. military operations or current Pentagon programs would not be negatively affected by the move.
"We have found the money ... and we will continue this effort," Little said during Tuesday's media briefing.
The Iraqi training money was put into the Combatant Commander's Initiative Fund, a discretionary pool of DOD funding used to finance operations deemed critical by U.S. field commanders.
The fund was used heavily for reconstruction and other programs by American commanders during the height of the Iraq war.
While DOD was able to temporarily finance Iraqi training operations, it remains unclear why Pentagon officials had to look internally for the money rather than have Congress pay for the extension.
Little declined to comment on why lawmakers did not legislate the money under its military or wartime funding authorities. However, he said, DOD "has a lot of discretion in [that] account" and did not require legislative action to finance Iraqi training operations, according to a congressional source.
Additional training funds for Iraq were also not addressed in the continuing budget resolution passed by Congress earlier this year.
That omission essentially put the onus to fund those operations on DOD's shoulders, the source added.
Winnefield's decision to extend Iraqi training operations comes as U.S. forces are starting to find themselves drawn back into the country, as militant terror groups continue to threaten the government's hold on power.
On Monday, a chain of coordinated bombings shattered several Shiite neighborhoods and Iraqi security outposts across the country, leaving 26 dead. A few days before, a mass prison break in the northern town of Tikrit left 10 prison guards dead and unleashed a number of prisoners and terror suspects back into the country.
The incidents are part of the violence and chaos that has engulfed Iraq since American forces pulled out of the country a year ago.
Amid such destruction, al Qaeda's Iraqi cell has sought to take advantage of the volatile situation in the country, bolstered by its increasing foothold in neighboring Syria.
To that end, Sen. John McCainJohn McCainA Cabinet position for Petraeus; disciplinary actions for Broadwell after affair Meet Trump’s ‘mad dog’ for the Pentagon Wrestling mogul McMahon could slam her way into Trump administration MORE (R-Ariz.) said earlier this month the country was in danger of "unraveling" in an explosion of secretarian violence and the rapid growth of Islamic militant groups in the country.
"The whole thing is unraveling, as many of us predicted. And the tragedy is we wasted so many American lives," McCain said at the time.
That said, the Pentagon has deployed a unit of U.S. Special Operations Forces to help Iraqi security forces with intelligence and counterterrorism operations.
The unit, whose deployment was first reported by The New York Times, was sent at the request of the Iraqi government.