IS, also known as ISIS or ISIL, Hagel said, is "an imminent threat to every interest we have, whether it's in Iraq or anywhere else."
"ISIL is as sophisticated and well-funded as any group that we have seen. They're just beyond a terrorist group. They marry ideology, a sophistication of strategic and tactical military prowess. They are tremendously well-funded."
In response to such a threat, the defense secretary advocated preparation, although he didn't expound on what the could entail: "we must prepare for everything." He also underlined the necessity of understanding IS, "And the only way you do that is that you take a cold, steely, hard look at it and -- and -- get ready."
Chairman of the Joint Chiefs of Staff Gen. Martin Dempsey, speaking alongside Hagel on Thursday, commented on the "immediacy" of the threat posed by IS.
"Well, the immediacy -- the immediacy is in the number of Europeans and other nationalities who have come to the region to become part of that ideology. And those -- those folks can go home at some point."
In the short term, the return of those foreign fighters to their homelands poses more of an immediate threat for Europe than the U.S., especially due to Europe's open borders and immigration issues. "It's why I have conversations with my European colleagues about their southern flank of NATO," Dempsey noted.
The future threat can be seen in the long-term goal of IS: to establish a wide-reaching caliphate.
"Longer term, it's about ISIL's vision, which includes -- I actually call ISIL, here we go, right, ISIS, I-S-I-S, because it's easier for me to remember that their long-term vision is the Islamic State of Iraq and al-Sham. And al-Sham includes Lebanon, the current state of Israel, Jordan, Iraq, Syria and Kuwait."
On Wednesday, President Barack Obama responded to the videotaped IS beheading of American journalist James Wright Foley by reaffirming that counter-terror operations against IS "must continue."
"From governments and peoples across the Middle East there has to be a common effort to extract this cancer, so that it does not spread. There has to be a clear rejection of these kind of nihilistic ideologies. One thing we can all agree on is that a group like ISIL has no place in the 21st century."
Hagel reasserted Thursday evening "we will continue to stay focused... on what we're doing now and exploring all options as we go forward."