Security in Baghdad and across Iraq has improved enormously in the nearly two years since Mr. Crocker was confirmed as ambassador, but many Iraqis, including Iraqi political leaders, worry that the current situation is merely a lull given the still-fractious political system.

Image After months of delays and other problems, the enormous new United States Embassy compound in Baghdad was dedicated on Monday by Iraqi and American officials, who declared the start of a new era for relations. The embassy is Americas largest in the world, and the final cost was said to be $736 million. Credit... Hadi Mizban/Associated Press

Mr. Crocker acknowledged the troubles since the invasion but said the implementation of the security agreement between Iraq and the United States, which went into effect on Jan. 1, was a sign of Iraq’s progress toward being a stable, sovereign state.

Of the 120 years since the United States first established a presence in Baghdad, Mr. Crocker said, “no period has been more intense, more challenging or more promising than that since April 2003. And of that period, perhaps no single week has been more important than this past one.”

On Dec. 31, the embassy officially moved out of the Republican Palace, the jewel of Baghdad’s government buildings and the headquarters of the American presence in Iraq since shortly after the invasion. For months, officials and members of the support staff, adding up to 1,200 people in all, have been gradually moving into the new embassy, America’s largest in the world. The Congressional Research Service said the final cost was $736 million; the original estimate was $592 million.

Though its construction also was troubled by long delays, structural problems and allegations of abusive labor practices, the embassy, a campus of adobe-colored buildings on 104 acres, has a far more functional appearance than the lavish palace. Surrounded by concrete walls topped with razor wires, the compound is less than a mile from the Republican Palace in the Green Zone, which was handed over to Iraqi control on Jan. 1 as part of the security agreement.