Shortly after the explosion, the Sunni extremist ISIS, which sees Shiite Muslims as apostates, claimed responsibility for the attack in an online statement.
Iraqi officials have raised the death toll from a car bombing in a commercial area in a predominantly Shiite neighbourhood of Baghdad to at least 29 people killed.
Two police officers say the explosives-laden car that went off this morning at a crowded outdoor market in Baghdad's eastern district of Sadr City also wounded up to 50 people, several seriously.
There are fears the death toll will rise further.
Shortly after the explosion, the Sunni extremist ISIS, which sees Shiite Muslims as apostates, claimed responsibility for the attack in an online statement.
It says the assault was carried out by a suicide bomber, but Iraqi officials denied that.
An explosives-laden car bomb ripped through a commercial area in a predominantly Shiite neighborhood of Baghdad on Wednesday, killing at least 18 people and wounding dozens, Iraqi officials said. The ISIS claimed responsibility for the attack.
The explosion struck a crowded outdoor market in the Iraqi capital's eastern district of Sadr City, a police official said, adding that the blast also wounded up to 45 people, several seriously. There were fears the death toll could rise further.
Several cars and nearby buildings were heavily damaged, he added.
Two medical officials confirmed the casualty figures. All officials spoke on condition of anonymity as they are not authorized to release information.
In an online statement, the extremist ISIS said it was behind the attack, describing it as a suicide attack that targeted a gathering of Shiite militiamen. The Associated Press could not immediately verify the authenticity of the claim but it appeared on a website commonly used by the Sunni extremist group.
ISIS also a controls significant area in northern and western Iraq, including the second-largest city of Mosul. Commercial and public places in Shiite-dominated areas are among the most frequent targets for the Sunni militants seeking to undermine the Iraqi government efforts to maintain security inside the capital.