Iraq celebrated a “day of national victory” to mark the withdrawal of US combat troops from its cities even as a bomb killed at least 30 people in Kirkuk in a reminder of the challenges facing the country’s security forces now that they are in charge.

In Baghdad, thousands of police and armed forces marched before dignitaries at the twin monuments to the regime of Saddam Hussein — the arch of the crossed swords and the Tomb of the Unknown Soldier.

The handover of power was a national holiday marked by triumph and fear, with cars prevented from parking in the capital in case of bombs and most people staying indoors.

“This day, which we consider a national celebration, is an achievement of all Iraqis,” Nouri al-Maliki, the Prime Minister, said. He added that the celebrations were tempered with grief for the “men, women and children who fell victims of terrorists, extremists, the men of the dictatorial Baath regime and the criminal gangs”.

At al-Faw Palace, the Saddam monument that became US Camp Victory, General Ray Odierno, the US military chief in Iraq, said that the country’s security forces could be proud of their dedication.

He addressed the increase in violence, in which more than 200 people have died in bombings in the past fortnight. General Odierno said that a bomb that killed more than 70 people at a mosque in a small town in the north showed that al-Qaeda would “now go after the softest of soft targets”.

The security problems continued when a car bomb exploded in the centre of Kirkuk yesterday, killing at least 30 and wounding dozens more. Kirkuk, which is crucial to the Iraqi oil industry, is riven by ethnic tensions between its Kurdish, Turkoman and Arab communities.

The US army also announced that four of its soldiers died from combat-related injuries on Monday, bringing the number of US troops killed since the invasion to 4,321.

There were celebrations too. On the banks of the Tigris in Baghdad, crowds of men, women and children gathered in gardens, singers and poets gave public performances and groups of people danced. At one concrete checkpoint police played loud music and danced on their cars. Their bunker was adorned with streamers and balloons. Cars with Iraqi flags streaming from the windows drove by full of young men beating drums.

“We are glad that the American forces are pulling out,” Muhammad Ahmed, a 22-year-old taxi driver, said between blasts on his horn. “It is a blessing from God.” Although he had concerns about security it was worth the joy of Iraqis being in control, he said. “Even if something happens, we are just a sacrifice for [our country].”

“I consider today to be the real fall of Saddam,” said Ali Jabal, who was among the crowd with his wife and children. “All Iraqis feel happy today, especially those who suffered the pain of wars and of sanctions. We are seeking a peaceful and happy life.”

Although the official deadline for the pullout was yesterday — according to the US-Iraqi status of forces agreement — America’s 133,000 troops have been withdrawing from urban areas to remote bases over several months.

Iraqi and US officials expressed concern about the pullout — particularly in the cities of Mosul, Baquba and Kirkuk, where attacks are common — but Mr al-Maliki insisted that Iraqi troops are up to the challenge.

“The people who said that the foreign troops would never withdraw and would keep permanent bases in our country were giving a green light to the terrorists to kill civilians,” he said.

In a television address Mr al-Maliki was confident about security before the elections in January. During his three years in office attacks have fallen but he has been criticised over the security forces amid fears of a possible resurgence in sectarian warfare.

An unspecified number of US troops will remain in the cities in a supporting role but they will not conduct patrols or other operations without being requested to do so. They will leave their bases in an emergency only over the next five days.

In Baghdad an Iraqi policeman said that the security forces were expecting car bombs but despite such concerns everyone was keen to emphasise national pride. “Of course we don’t want the Americans to stay,” Sinan Muhammad, 31, said. “Nobody likes an occupation.”

On Monday night thousands of people in Baghdad attended a party in Zawra Park by Iraqi pop stars who have returned from exile. They included Qassem Sultan, a singer who had a hit with a song supporting Saddam in the run-up to the 2003 invasion and who was later targeted by al-Mahdi Army, a Shia militia. He moved back to Baghdad when security improved.

President Obama warned of “difficult days ahead” but said that “Iraq’s leaders must now make some hard choices necessary to resolve key political questions to advance opportunity and provide security for their towns and their cities”.

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