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Six Iraqis, two American soldiers and two US civilians have been killed in a bomb attack at a local council office in eastern Baghdad.
One of the US civilians was an official with the state department and the other worked for the defence department, US embassy officials said.
Ten people were wounded including three members of the Sadr City council.
The US military has blamed the attack on what it calls "special groups", or rogue members of Shia Muslim militias.
Iraqi police said the attack was carried out by a suicide bomber, but investigations by the US military suggested a bomb had been planted in the building.
A suspect who tested positive for contact with explosives had been caught trying to flee the scene, the US said.
Eyewitnesses said the bomb exploded inside the office of the deputy leader of the council, who was among the injured.
Emphasis on councils
Representatives had been due to elect a chairman of the council for Sadr City, a militant Shia stronghold which has been the scene of fierce battles between US troops and fighters from the Mehdi Army, the militia loyal to the anti-US Shia Muslim cleric Moqtada Sadr.
On Monday, a gunman opened fire at US troops attending a municipal council meeting in a mainly Sunni Muslim area south-east of Baghdad, killing two soldiers and and wounding another three.
Correspondents say the US military has been working hard to shore up local government in Iraq amid a sharp drop in insurgency activity, to prevent areas from falling back under the control of Sunni and Shia extremists.
"This was the fourth meeting of this district council, led by hard-working Iraqis determined to make a difference and set Sadr City off on the right path," said US spokesman Lt Col John Digiambatista.
"Special Groups are afraid of progress and afraid of empowering the people," he added.
He said the "cowardly" attack would only harden the determination of this council, as well as local civilians and the military.
PHOTO CAPTION:
Baghdad bomb attack
BBC
