The discovery was made as SAS forces who helped in the assault of the final ISIS stronghold in Syria, Baghuz.
Among the severed heads were jihadis apparently executed by their commanders over allegations of spying.
The Mail on Sunday reported the heads were found in dustbins in a network of tunnels that ISIS fighters had retreated into when making their last stand in Syria.
During the battle more than 100 jihadis were killed while only two British soldiers were wounded – neither one has life-threatening injuries.
Speaking to The Mail on Sunday, a source said: “In their hour of defeat, the jihadis’ cruelty knew no bounds. They conducted a cowardly slaughter of these desperately unfortunate women as a final act of depravity and left their severed heads behind for us to find.”
The source, who said none of the troops would forget what they found, described the scene like something from the film Apocalypse Now.
SAS soldiers were first deployed to Iraq and Syria in 2015 in a manhunt for Mohammed Emwazi, the London-born militant known as “Jihadi John”, who became infamous for beheading Western hostages – Emwazi was killed by an air strike in Raqqa in November that year.
Last month soldiers from the SAS’s B Squadron left Al-Tanf on the Iraqi-Syria border to travel to Baghuz – accompanied by specialist mortar fire controllers and radio operators.
SAS operatives were also accompanied by hundreds of Western-trained troops from the Syrian Defence Force (SDF).
RAF Typhoon fighter aircrafts destroyed ISIS strongholds in the final battle using Storm Shadow and Brimstone 2 rockets, while unmanned Reaper drones provided 24-hour surveillance of Baghuz.
A source told The Mail: “The battle proper began on February 9. In the first two days, 37 IS fighters were killed and 19 enemy positions were destroyed, including the jihadis’ operational control centre in a mosque in Baghuz on February 11.”
The terror group were forced underground but drones were able to identify the entrances to the tunnels, which were found by artillery and mortars.
More than a thousand civilians were evacuated while ISIS fighters were kept underground – among them were fighters disguised as women, who were arrested.
As SAS and SDF forces cleared the tunnels in night vision goggles, they faced a treacherous web of landmines and other explosives.
The disposal of these took several days, during which 26 more ISIS fighters were killed.