The explosion took place in a Shiite majority city at the time when people were busy in shopping at the beginning of Ramadan.
Extremist group ISIS claimed the responsibility of the attack.
The group continued to carry out attacks in Iraqi cities that had killed more than 200 people.
Iraqi forces are also fighting in Fallujah to retake it.
Iran’s foreign ministry condemned the attack in the Shiite holy city and extended their condolences to the families of the victims of the attack.