The violence, which comes a few weeks before scheduled elections, is the latest by insurgents bent on destabilizing the country.
The blast struck the entrance of the city of Hillah during morning rush hour as dozens of cars waited to be searched. The explosion killed 21 civilians, including a woman and 12 year old, and 15 security personnel, two police officers said. It wounded at least 115, they said.
The bombing set dozens of cars ablaze, killing those trapped inside. Debris littered the ground, covered by foam sprayed by firefighters trying to extinguish the fire.
Hillah, a Shiite-dominated city, is located about 95 kilometres south of the capital, Baghdad.
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Elsewhere t, militants launched attacks just outside the capital against security forces and employees of the state-run oil company, killing six people, police said. They said the assaults wounded 16.
Medical officials confirmed the casualty figures for all the attacks. All officials spoke on condition of anonymity as they were not authorized to release the information.
Iraq has seen a spike in violence since last April, with the death toll climbing to its highest levels since the worst of the country's sectarian bloodletting in 2006-2008.
No one immediately claimed responsibility for the attacks, but they bore the hallmarks of an al-Qaida breakaway group that frequently uses car bombs and suicide attacks to target public areas and government buildings in their bid to undermine confidence in the government.
Iraq is to hold its first parliamentary elections since the US troops' withdrawal in late 2011 in April.