Iraq violence: Car bomb kills scores in mainly Shia town Published duration 18 July 2015

media caption Footage showed a huge crater caused by the blast, as Ahmed Maher reports

A car bomb has killed 120 people and injured at least 130 at a busy market in an Iraqi town, officials have said.

The attack happened in the predominantly Shia town of Khan Bani Saad, north of the capital Baghdad.

Children were among those dead in the explosion, which came as people celebrated the end of the Muslim holy month of Ramadan.

The Islamic State (IS) group, which control swathes of the country, has said it was behind the attack.

A statement from the group said one of its members drove three tonnes of explosives into a crowd.

image copyright Reuters image caption Residents say that Khan Beni Saad has become a disaster area

image copyright AP image caption Islamic State has said it was behind the attack

image copyright AP image caption The Diyala provincial authorities have declared three days of mourning

Correspondents say that it was one of the deadliest single attacks in Iraq over the last 10 years and completely destroyed several buildings.

Police major Ahmed al-Tamimi told Reuters the damage was "devastating".

"Some people were using vegetable boxes to collect children's body parts," he said.

Diyala resident Sayif Ali told the AP news that Khan Beni Saad has become a disaster area as its residents continued to search for bodies.

Meanwhile Iraqi parliament speaker Salim al-Jabouri said on Saturday that the attack has revealed an "ugly sectarian chord" and that the government was doing all it could to stop IS from further destabilising Diyala.

The Diyala provincial authorities have declared three days of mourning and cancelled festivities for Eid al-Fitr, which marks the end of Ramadan.

IS militants are battling government forces in the north and west of the country.

The group captured parts of Diyala last year. Although IS was later driven out, it still has a presence there.