The company, which is based in London and also owns British Airways, revealed in a statement that it had decided to convert eight options that were previously announced in 2011.
IAG said it had negotiated a "substantial discount" from list prices for the aircraft, which will be delivered between late 2015 and 2018. Airlines tend to receive large reductions on the cost of planes.
Airbus meanwhile added in a separate statement that the eight jets will be equipped with General Electric CF6 engines.
Iberia's fleet, which is comprised of only Airbus aircraft, already includes eight A330-300s.
"We are just delighted that Iberia has reconfirmed its confidence in the A330," said John Leahy, Airbus chief operating officer, customers.
He added that Airbus was "extremely pleased to welcome them as a new operator of the A330-200 benefiting from the enhanced performance that the new 242 tonne version brings, while continuing to deliver the family synergies of an all Airbus fleet."
In early August, IAG announced an order for eight A350s and said that it also planned to take eight A330-200s — either from a leasing company or by converting options signed with Airbus in 2011.
In total, the 16 Airbus planes will replace 16 A340 family aircraft in Iberia's long-haul fleet.
IAG had announced last month that net profit more than doubled to 280 million euros in the second quarter compared with a year earlier, boosted by cost-cutting at Iberia.