Market blasts and other bombings across Iraq killed at least 40 people and wounded more than 100 on Tuesday, spooking an already rattled public and spurring security officials to clamp down on traffic as Shia Muslims brace for more tragedy during pilgrimages this week.

The wave of morning bombings struck six Iraqi cities and towns, the worst hit being Diwaniyah, 130 kilometres south of Baghdad, where an explosives-laden vegetable truck detonated in a crowded market, killing 26 people and leaving 75 injured.

Vegetable seller Salah Abbas, 41, described a scene of chaos after the explosion ripped through the crowd.

"There were many charred bodies on the ground," said Abbas, who rushed to help wounded fellow merchants before ambulances arrived. He managed to push one to safety in a cart, but two other colleagues died at the market.

"People screaming and crying — some were coming in to get their relatives while others were running out. Then rumours spread of more car bombs, and people ran run out of the market in panic," he added.

Sunni insurgents known to target Shia pilgrimages

Tuesday's attacks come as hundreds of thousands of Shia pilgrims head to the holy city of Karbala this week for religious ceremonies that are expected to peak on Friday. Shia pilgrimages are a favourite target of Sunni insurgents linked to al-Qaeda, and attacks timed to strike during a similar march in Baghdad last month left 100 dead.

Diwaniyah is located about 40 kilometres from Karbala, which also was hit by two bombs in cars parked outside a market in early morning strikes that killed five people and wounded 30.

Jubair al-Jabouri, chairman of the Qadisiyah provincial council, confirmed the death toll in Diwaniyah, a Shiite city and the provincial capital. He blamed al-Qaeda for the attacks.

"Terrorism has no religion," al-Jabouri said. "The terrorists targeted the innocents today in Karbala and Diwaniyah."

No one immediately claimed responsibility for the bombings, which come on the heels of a particularly bloody June when attacks focused almost exclusively on Shia pilgrims, government officials and security forces. Al-Qaeda frequently launches bombings and deadly shootings against these groups.

Last month, no more than three days passed without a major attack, signalling the insurgency's ability to regroup quickly as opposed to earlier patterns where militants took several weeks to co-ordinate and gather material for an occasional, if spectacular, wave of bombings.

Despite taking extra measures, security forces appear powerless to stop the violence. That has damaged the government's already shaky credibility with the Iraqi people and fanned fears the country may be spiraling out of control without recourse to American troops, the last of which withdrew last December after nearly nine years of war.

Iraqi officials and experts say the Sunni insurgents have been emboldened by a months-long political crisis that has all but paralyzed the government, and now seek to exploit tensions between the country's ethnic and sectarian factions.

Within hours of the two Karbala bombings, authorities banned vehicles from entering the holy city to protect the pilgrims though Friday. Karbala, located 80 kilometres south of Baghdad, is the destination for annual Shia rituals on the anniversary of the birth of the ninth-century Shia leader known as the Hidden Imam.

"Al-Qaeda groups are trying to stop Shia people from practicing their rituals of the pilgrimage," said Karbala Gov. Amal-Din al-Hir. "But we are confident that the Shia pilgrims will be undaunted by these explosions."

Bombs struck two other cities in central Iraq shortly before the Diwaniyah attack.

In the Sunni city of Taji, two bombs killed three people and wounded 15. A policeman was among the dead, said security and health officials who confirmed the casualties. Taji is home to a military base and is 20 kilometres north of Baghdad.

In the capital itself, two roadside bombs exploded near security patrols in separate neighbourhoods, killing a police officer and a passer-by, officials said.