However, product development and testing will still be conducted at its headquarters in Roy, Iomega spokesman Chris Romoser told The Associated Press.
The layoffs will affect mainly production staff, and will take place with immediate effect.
Iomega has been struggling lately, as cheap hard drives have squeezed the market for its Zip drives. The company which produces computer data storage drives and software, also makes Jaz drives and CD writers.
In May, its president and CEO Bruce Albertson resigned because of differences over the company's long-term strategy.
Before this round of layoffs, the company had 3,500 staff worldwide.