The raging violence has raised renewed fears that the country is sliding towards civil war, prompting Prime Minister Nuri al-Maliki to issue an urgent appeal for unity.

In Tuesday's deadliest attack, 10 Shias carrying a coffin in a minibus were ambushed and shot dead by gunmen on a highway near Baghdad's notorious Sunni neighbourhood of Dura, a defence ministry official said.

The passengers were heading to the Shia holy city of Najaf to bury the corpse when they were "ambushed by gunmen on the highway, taken out and shot dead," the official said.

The attack came less than two hours after a curfew imposed on Dura the day before ended.

The curfew was imposed after Dura residents reported hearing gunfire and said large numbers of armed men were out on the streets. The neighbourhood has been the scene of repeated fighting and attacks on security forces.

In Iraq's northern Salaheddin province a raging gunbattle between Iraqi troops and villagers left 10 soldiers dead, a security source said.

A group of soldiers raided Al-Salman village, 260km northwest of Baghdad early Tuesday, but met stiff resistance from armed villagers, the source said, adding that civilian casualties wee not known.

In Baghdad, five people were killed and 10 wounded in a car bombing and a suicide bombing near the heavily fortified Green Zone, the seat of the Iraqi government and headquarters of the US military.

A car bomb went off near a restaurant about 100 meters (yards) from the Green Zone, which also houses the courtroom where trial of ousted leader Saddam Hussein is taking place.

Just minutes later a suicide bomber blew himself up near the site of the earlier blast, police said.

Another 11 people were killed in other attacks in Baghdad and other parts of the country Tuesday.

More than 80 people have been killed in the last two days in sectarian bloodshed in Baghdad -- one of the largest bouts of violence since the bombing of a revered Shia shrine in February, which triggered nationwide Shia-Sunni reprisals.

On Sunday at least 61 people were killed, including 42 Sunni Arabs massacred by rampaging mobs, believed to Shia militias, in Baghdad's Sunni neighbourhood of Jihad.

In an apparent revenge attack on Monday, 10 people were killed and 51 wounded in a car bombing and mortar attack in the Shia-dominated slum district of Sadr City, police said.

"We have no choice but to defeat those who want to plunge us in the darkness. We can only achieve this through national unity," Maliki said in an address to the Kurdish parliament in Arbil on Monday.

"We still face a lot of challenges and Iraqi blood is being spilt on our streets every day, but no and a thousand nos, they will not defeat us."

But in a separate incident Tuesday, Iraqi diplomat Wissam Jabr, on leave from his post in Iran, was kidnapped in Baghdad, a defence ministry official said.

Armed gangs and insurgent groups are increasingly use kidnapping as a means of raising funds.

Meanwhile, the US military condemned an Internet video posted by al-Qaeda's Iraq branch showing the mutilated bodies of two US soldiers it claims to have killed last month.

"It demonstrates the barbaric and brutal nature of the terrorists and their complete disregard for human life," the military said.

The two soldiers -- Kristian Menchaca and Thomas Tucker - were taken captive on June 16 near Yusifiyah, south of Baghdad, and their bodies with throats slit were found three days later booby-trapped with explosives in the same vicinity.

al-Qaeda said it was to avenge an Iraqi female allegedly raped and murdered by US soldiers south of Baghdad in March. A former soldier and five other servicemen currently stationed in Iraq have been charged over incident.