Some countries have greeted the news happily, but America is not impressed.
The US Government says the move is just a ploy because Iraq wants to stop America gathering support to attack its leader, Saddam Hussein.
They are both afraid that Saddam could launch terrorist attacks on the rest of the world.
Threat of war
But other countries, like Russia and China, have welcomed Iraq's decision. Russia said the threat of war had been avoided thanks to lots of high-level talks.