Members of Iraq's Sunni Arab minority have been protesting against the Shiite-led government since December, angered over what they see as second-class treatment of their sect and what they see as unfair application of tough anti-terrorism measures. Attacks surged after a deadly crackdown on a Sunni protest camp by security forces in April.
There was no immediate claim of responsibility for Friday's attack.
Al-Qaida's local branch, known as the Islamic State of Iraq and the Levant, and other Sunni extremists have tried to harness the anger of many Sunnis, even as more moderate members of the sect appeal for calm.
Al-Qaida has claimed responsibility for a number of large-scale bombings in recent months and is believed to be behind other coordinated attacks. It frequently targets Shiite civilians, members of the security forces and those seen to be closely tied to the country's Shiite-led government.
There has also been a spike in attacks on Sunni mosques in recent months. While it is possible that Sunni extremists could be to blame, Shiite militias that had been largely quiet for years may also be behind those assaults.
More than 4,000 people have been killed in violent attacks since the start of April, including 804 just in August, according to United Nations figures.
Baqouba itself was hit with deadly violence just this week. Three car bombs targeting outdoor markets killed at least 10 civilians and wounded more than 30 there Tuesday.
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Associated Press writer Adam Schreck contributed to this report.