The blast, apparently caused by a suicide bomber, occurred at about 8 a.m. near the "Assassin's Gate" to Saddam Hussein's former Republican Palace complex, now used by the U.S.-led occupation authority for headquarters. The gate is used by hundreds of Iraqis employed by the Coalition Provisional Authority, the formal name of the U.S.-led occupation authorities, as well as U.S. military vehicles.

The 18 dead included 16 Iraqi civilians and two American civilians, the U.S. military press office said. The wounded included 22 Iraqi civilians, four American civilians and two U.S. soldiers, the press office said.

Brig. Gen. Mark Hertling, deputy commander of the 1st Armored Division, said the blast was caused by a car bomb, and American officials were "assuming this was a suicide bomb." Witnesses said the blast occurred as one, possibly two, Land Cruisers approached the heavily guarded gate.

"It was literally at the last point a vehicle could get to without being stopped," Hertling said. "The barriers absorbed most of the blast."

Police Gen. Hassan al-Obeidi said the blast was caused by a lone suicide driver.

A witness, Salah Farhan, said he was accompanying colleagues through the checkpoint when he saw a Land Cruiser try to cut to the head of the line. The vehicle exploded about two cars back from the gate, he said.

U.S. troops guarding the gate took cover when they saw the vehicle try to move to the front of the line.

The area is one of the most heavily guarded in the capital. U.S. soldiers guarding the gate usually stand about 20 yards from the road behind coils of barbed wire and concrete barriers.

One witness, Hamid Hawwam, said two cars exploded at the gate, and one of them flew into the air.

Another, Haidar Hanoun, said he was lining up for a job when a Land Cruiser and another vehicle exploded.

"It was very strong. There are a lot of injured and dead," he said.

Karar Abbas, an Iraqi civil defense trooper, said the blast engulfed seven cars parked along the street.

Mohammed Jabbar, who works at the Ministry of Planning, said he was waiting to pass through the security checkpoint when the blast occurred.

"When the explosion went off, it was very strong," he said. "It lifted us into the air. People fell on top of one another."

At least three separate fires were seen after the blast. One man was seen lying motionless on the side of the road as coalition soldiers and civilians helped the wounded.

Coalition tanks also moved in near the blazes.

"The wounded are in big numbers, there are killed, there were people whom we couldn't take to the hospital," engineer Khalid Taleb said. "It is a very crowded area."

Several of the wounded squatted helplessly on the ground. Some, shocked and weeping, were comforted by bystanders. One wounded man was carried away in what looked like a bed sheet.

Nabil Abdul Zahar said a friend standing with him in line for security checks was killed.

"My friend was standing behind me in the line when the explosion happened," a shaken Zahar said. "There were lots of injured. I called for help and no one came to help me. He died right there on the ground."

Iraqi police announced on loudspeakers that coalition forces will give $2,500 to anyone providing information on the perpetrators.

The explosion could be heard along the banks of the Tigris River, which flows through the center of the city of 5 million. Dense morning fog blanketed the city at the time.

The last large explosions in the center of Baghdad occurred Monday when mortars exploded near the river.