The eight suspects were arrested after anti-terror police raided their hideout in Daska, central Punjab, provincial Law Minister Rana Sanaullah told AFP.
"They were trying to establish their group network and had plans to carry out attacks," said Sanaullah.
"All of them are young and in their 20's. Police also recovered Daesh literature and CDs," Sanaullah added.
"They were taking instruction via the Internet from a person named Abu Muawiyah".
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Daesh is an Arabic acronym for the Islamic State (IS) group, which controls wide swathes of territory in Iraq and Syria.
Police commandos from the counter-terrorism department (CTD) raided the hideout and made the arrests on Monday, according to the official.
A senior CTD official confirmed the arrests and told AFP that some of the suspected militants were former members of Jamaatud Dawa (JuD).
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The arrests came as a Taliban suicide bomber on a motorcycle killed 26 people after crashing into the main gate of a government office in Mardan.
The blast in Mardan demonstrated the Pakistani Taliban's continued ability to stage deadly attacks, despite a major military offensive against its headquarters that analysts say has reduced its capacity.
The government has officially denied that IS is operating in Pakistan, which has been wracked by al Qaeda and Taliban-linked violence for more than a decade.
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But authorities have expressed fears that IS could find recruits among Pakistan's myriad of extremist militant groups.
In May, the Islamic State group claimed responsibility for an attack that claimed the lives of at least 43 members of the Shia Ismaili minority in the southern port city of Karachi.
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