More than 140 people have been killed in blasts targeting Iraqi Shias as they celebrated the climax of a holy ritual in the cities of Karbala and Baghdad.
Hundreds of wounded people overwhelmed nearby hospitals
US military officials say 400 were hurt in the near-simultaneous attacks of the bloodiest day since the war began.
The carnage was soon blamed on a man accused of links to al-Qaeda.
There has been confusion over what caused the blasts, but mortars may have been used in what correspondents say is an alarming new method for insurgents.
The Iraqi Governing Council offered condolences to relatives of the dead and declared three days of national mourning.
It is not yet known if the official mourning will delay the signing of a draft constitution planned for Wednesday.
The US military said 85 people were killed and 230 wounded in Karbala, while 58 died in Baghdad and 200 were left wounded. Hospital sources in Karbala put the numbers higher, with as many as 100 dead there.
US spokesman Brig Gen Mark Kimmitt said Abu Musab al-Zarqawi, a Jordanian accused by the US of having links to Osama Bin Laden's al-Qaeda, was "a prime suspect, if not the prime suspect" in the planning of what he called "sophisticated" and "well co-ordinated" attacks.
US officials say a letter from Mr Zarqawi urging attacks on Shia Muslims was intercepted last month.
A Shia member of the Council, Mowaffaq al-Rubaie, went further, blaming the attacks outright on Mr Zarqawi, but saying all sections of Iraqi society were determined to move forward.
"The civil war and sectarian strife that Zarqawi wants to inflict on the people of Iraq will not succeed," he said.
"Zarqawi failed, his gang and their evil plans have failed."
At least six explosions hit Karbala at about 1000 local time (0700GMT) aimed at the main mosque in the holy city.
The blasts sparked panic among the crowds who were able to observe Ashura - commemorating the death of Imam Hussein in 680 - freely for the first time in decades.
People - bloodied, with limbs lost - were carried to ambulances on stretchers made from blankets and wooden carts.
SHIA FESTIVAL: ASHURA
Annual Shia festival commemorating martyrdom of Imam Hussein
Hussein, grandson of Prophet Mohammad, killed at Karbala by army of Caliph Yazid in 680
Faithful strike themselves with chains and swords to atone for Hussein martyrdom
The murder 19 years earlier of Ali, Hussein's father, gave rise to the central schism in Islam between Sunni and Shia
"We were standing [next to the mosques] when we heard an explosion," said 18-year-old Tarar. "We saw flesh, arms, legs and more flesh. Then the ambulance came."
Confusion surrounded the cause of the blasts, with police officers running through the streets checking bins and boxes for more bombs.
Gen Kimmitt said later that there were reports of a mortar attack in Karbala, 80km (50 miles) south of Baghdad, as well as at least one suicide bomber.
The BBC's Caroline Hawley in Baghdad says the use of mortars - if confirmed - would be a new tactic for insurgents seeking to stir up sectarian tensions between Sunni and Shia Muslims.
Mortars had previously been used against coalition forces, but not Iraqi civilians.
Gen Kimmitt said three suicide bombers blew themselves up in Baghdad and a fourth was caught before detonating explosives.
Iraqi police reported they had arrested six people in connection with the attacks.
Violence had been feared but US and other coalition soldiers had left the immediate areas around the mosques to Iraqi security forces so as not to offend religious sensibilities.
In both cities, shock soon turned to anger and foreign civilians and soldiers were targeted.
But later, in active defiance of the attacks, pilgrims continued the last day of the Ashura rituals.
Religious ceremonies of the Shia Muslims - the majority group in Iraq but suppressed under the Sunni Muslim rule of Saddam Hussein - have been targeted before.
Last August, more than 85 people were killed when a car bomb exploded outside a mosque in Shia Muslim holy city of Najaf, killing more than 85 people, including Shia leader Ayatollah Mohammed Baqir al-Hakim.