The blast targeted pilgrims returning from Karbala, CNN reported. The bomb exploded in Musayyib, a city south of Baghdad.
The Financial Times put the death toll at 27. The newspaper said the bombing followed days of increased tensions between Sunni and Shiite Muslims, including large demonstrations by Sunnis against the Shiite-dominated government.
A few hours before the bomb went off, officials announced they would meet one demand by freeing 11 women from prison and transferring others to facilities in their home provinces. But the government of Prime Minister Nouri al-Maliki has also threatened to use force against protesters.