Police officials say the blast went off this morning at the crowded market in the primarily Shiite neighborhood of Amil in southwestern Baghdad.
The police said 12 other people were wounded in the attack.
Medical officials confirmed the casualty figures. All officials spoke on condition of anonymity because they are not authorized to speak to media.
Iraq has seen a surge in militant attacks and violence since a deadly April crackdown by security forces on a Sunni protest camp in a northern town. At least 90 people have died in attacks in Iraq so far this month, according to an Associated Press count.
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