A suicide bomber detonated a vest packed with metal ball bearings in a refreshment tent full of Iraqi pilgrims heading to a Shi'ite festival yesterday, killing 40 people and wounding 60, police said.

The US military said it was trying to confirm reports 60 people had been killed and 100 wounded in the bombing in the town of Iskandariya, 40 kilometres south of Baghdad. Women and children were among the victims, police said.

The attack was one of the deadliest in Iraq this year and happened despite a major tightening of security for the annual Arbain festival in the southern holy city of Kerbala. It is one of Shi'ite Islam's holiest events.

Most of the casualties were hit by the ball bearings, said a doctor at a hospital in the city of Hilla, where many of the wounded were taken. A wounded woman there said the attack happened in a tent where pilgrims were offered refreshments.

"When we reached the area people invited us into a tent to take some rest and have some food. When we entered, there was a huge ball of fire and we saw people lying on the ground," said Um A'amr, who was being treated for multiple wounds.

Police and the US military said the bomber struck hours after militants killed three pilgrims and wounded 36 others in an attack in southern Baghdad. Captain Muthanna al-Mamouri, spokesman for police in Hilla, 100 kilometres south of the capital, said 40 people were killed and 60 wounded in the Iskandariya attack.

The US military said in a statement the attack took place on a two-lane highway near a residential area through which more than 40,000 pilgrims had passed earlier in the day.

Tens of thousands of Iraqi soldiers and police have been deployed for the Arbain festival after suspected Sunni Arab insurgents killed 149 pilgrims on their way to Kerbala for the event last year, one of the worst spasms of violence since the US-led invasion of Iraq in 2003.

The pilgrims are particularly vulnerable to attack because many prefer to walk to Kerbala, 110 kilometres south of Baghdad. They believe the effort will bring them greater spiritual reward.

Millions of Shi'ite pilgrims are expected in Kerbala for Arbain this week, which commemorates the end of the 40-day mourning period following Ashura, a religious ritual that marks the death of Prophet Mohammad's grandson in 680.

In the Baghdad attack, the pilgrims were hit by a roadside bomb and then fired on by gunmen on a road used by pilgrims walking to Kerbala, police said.

The US military gave a different account, saying gunmen had lobbed hand grenades at the pilgrims in Baghdad, killing one and wounding 17.