"Our forces are in complete control of the Iraqi-Syrian border and I therefore announce the end of the war against Daesh,” Abadi told a conference in Baghdad on Saturday, Iraqi News reported.
The Iraqi armed forces later added in a statement that the country has been "totally liberated” from Daesh.
The announcement came after the Iraqi army soldiers, backed by allied fighters, managed to clear the Western desert bordering Syria of the last pockets of Takfiri militants.
Abadi had reserved announcing an ultimate victory over ISIL until after those last small concentrations were cleansed.
ISIL began a terror campaign in Iraq in 2014, overrunning vast swathes in lightning attacks. Iraqi forces then launched operations to eliminate ISIL and retake lost territory.