Iraqi security forces jubilantly paraded in tanks and armoured vehicles on Tuesday as they took control of towns and cities, but the celebrations were marred by a car bomb that killed 27 people.
US President Barack Obama, who opposed predecessor George W. Bush's invasion of the country and campaigned for an early pullout of US troops, hailed the withdrawal as an "important milestone" but warned of difficult days ahead.
Iraq marked the American pullback with a national holiday six years after the invasion that toppled Saddam Hussein, but sparked an insurgency and sectarian bloodshed that left tens of thousands dead.
American troops were to have quit built-up areas by midnight (2100 GMT), ahead of a complete pullout by the end of 2011.
|Iraqis look on as others clamber over the smoldering wreckage following a car bomb at a central market in the northern city of Kirkuk|
"It is an offence to the Iraqis. The people who said that the foreign troops would never withdraw and would keep permanent bases in our country were giving a green light to the terrorists to kill civilians," he said.
Twenty-seven people, including women and children, were killed and 80 hurt in the evening attack in Kirkuk, the city's health director said.
President Jalal Talabani thanked US forces for their role in overthrowing Saddam's regime in 2003 and in the years that followed.
"They bore the burden and dangers against the most cruel regime and against the mutual enemy -- the terror," he said on state television.
The handover coincided with the US Army announcing that four of its soldiers had died from combat-related injuries on Monday, taking to 4,321 the number of American troops killed since the invasion.
Speaking at the White House, Obama said "the Iraqi people are rightfully treating this day as a cause for celebration.
"This is an important step forward, as a sovereign and united Iraq continues to take control of its own destiny," Obama said, hailing the pullback as an "important milestone."
He said it was now up to Iraq's leaders to take steps to bolster what the White House says are improving security conditions in Iraq.
"Iraq's leaders must now make some hard choices necessary to resolve key political questions to advance opportunity and provide security for their towns and their cities," Obama said.
"Make no mistake, there will be difficult days ahead. We know that the violence in Iraq will continue; we see that already in the senseless bombing in Kirkuk earlier today."
Obama has asked Vice President Joe Biden to take on a new role overseeing the US departure from Iraq and Washington's effort to promote internal political reconciliation there.
The White House said Tuesday that Biden would work closely with General Ray Odierno, the top US commander in Iraq and US ambassador to Baghdad Christopher Hill as US forces prefer to leave for good by the end of 2011.
Maliki warned earlier this month that insurgent groups and militias were likely to step up attacks in the run-up to June 30 in a bid to undermine confidence in Iraq's own security forces.
There have been several huge bombings since, the deadliest near Kirkuk on June 20 when 72 people were killed.
US Defense Secretary Robert Gates said Tuesday he expects "sporadic attacks" in the coming months as Al-Qaeda "increase the level of violence to try to pretend that they forced us out of the cities" and show weakness in the Iraqi security forces.
Odierno told US reporters in a video briefing from Baghdad that he believed Iraq was now better off "not having a dictator such as Saddam Hussein.
"They are now going to be able to see that they can move ahead and the people of Iraq will have a say in their government."
He declined to say how many US troops would be left in urban centres, saying that figure "will be different every single day," adding that the remaining US troops would be acting as trainers and advisers.
Tuesday's pullback was part of a security agreement signed in November setting the terms for a continued US troop presence in Iraq. There are now some 133,000 US personnel in Iraq.
Across Baghdad, tanks and armoured vehicles manned by soldiers and police and decorated with artificial flowers, flags and banners passed through the city, as nationalistic songs and popular music played.
"We are happy to receive the security responsibilities and we are able to totally protect our citizens," said policeman Ibrahim al-Mashhadani.
The Status of Forces Agreement, which set the pullback deadline, says US commanders must now seek Iraqi permission to conduct operations, but their troops retain a unilateral right to "legitimate self-defence."
Three out of four Americans support the withdrawal from urban centres, although they believe the pullout may lead to increased violence, according to a CNN/Opinion Research Corporation poll released on Tuesday.