Home Secretary Amber Rudd is visiting the US to meet tech companies to discuss the idea, as well as other efforts to tackle extremism.
The UK government provided £600,000 of public funds towards the creation of the tool by an artificial intelligence company based in London.
ASI Data Science said the software is capable of detecting 94 percent of IS's online activity, with an accuracy of 99.995 percent.
Anything the software was not sure about would then be flagged up for a human decision to be taken.
It is intended to lighten the moderation burden faced by small companies that may not have the resources to tackle extremist material being posted on their sites.
Similar tools in the past have been heavily criticised by advocates of an "open" internet, saying such efforts can produce false positives - and that means content that is not particularly problematic ends up being taken down or blocked.
It is basically an algorithm that draws on characteristics typical of IS and its online activity.
Rudd said the tool was made as a way to demonstrate that the government's demand for a clampdown on extremist activity was not unreasonable.
"It's a compelling example of the fact that you can have the information you need to make sure this material doesn't go online in the first place. The technology is there. There are tools out there that can do what we're asking. For smaller companies, this could be ideal."