The blast brought down several buildings in Khan Bani Saad, about 30 km (20 miles) northeast of Baghdad, crushing to death people who were celebrating the end of the Muslim fasting month of Ramadan, police and medics said.
               
Islamic State, which controls large parts of northern and western Iraq claimed responsibility for the attack in the mixed eastern province of Diyala where Khan Bani Saad is located and said the target was "rejectionists", as the group refers to Shi'ite Muslims.
               
Angry crowds went on the rampage after the explosion, smashing the windows of cars parked in the street in grief and anger. Body parts were flung onto the roofs of nearby buildings by the force of the blast, police said.
               
"Some people were using vegetable boxes to collect children's body parts," said police major Ahmed al-Tamimi from the site of the explosion, describing the damage to the market as "devastating".
               
An officer from the Diyala police command said rescue crews were still retrieving bodies from under the debris so the death toll could rise.
               
The Diyala provincial government declared three days' mourning and ordered all parks and entertainment places to close for the rest of the Eid al-Fitr holiday to pre-empt any further attacks.
               
Islamic State said in a statement issued on Twitter that the attack was to avenge the killing of Sunni Muslims in the northern Iraqi town of Hawija, and that the suicide car bomber was carrying around three tonnes of explosives.

Latest News from World News Desk