BAGHDAD—Iraq's leader accused the country's Kurds of letting radical Islamist militants use their regional capital of Erbil as an operations center, an allegation Kurdish officials dismissed, as evidence of another sectarian massacre emerged.

Iraqi Prime Minister Nouri al-Maliki's allegation came after the semiautonomous Kurdish region in Iraq, which is pressing for independence, capitalized on a Sunni extremist assault by seizing territory for themselves, including the oil-rich city of Kirkuk. Then last week, Kurdistan President...