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Dozens of Shiite villagers in the north were massacred by Sunni extremists, two officials said Tuesday, while a car bomb exploded across the street from the Iranian Embassy in the heart of Baghdad and killed four civilians.

Meanwhile, Shiite legislators loyal to anti-U.S. cleric Muqtada al-Sadr decided to end their five-week boycott of parliament, one of their leaders said. The Shiite protest along with a separate Sunni boycott had blocked work on key benchmark legislation demanded by the U.S.

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Police Col. Ragheb Radhi al-Omairi said 29 members of a Shiite tribe were massacred overnight in Diyala province when dozens of suspected Sunni gunmen raided their village near Muqdadiyah, about 60 miles northeast of Baghdad. The dead included four women, al-Omairi said.

Al-Omairi said he had not seen the bodies. Police said some of the bodies were recovered, and that some of the gunmen wore military clothing.

The village is in the same province as Baqouba, where fighting escalated Tuesday. U.S. and Iraqi troops regained control of western Baqouba last month, but al-Qaida and other Sunni insurgent elements remain active in the rest of the city. The al-Qaida front Islamic State of Iraq had declared Baqouba its capital.

On Tuesday, U.S. soldiers pushed into the insurgent-controlled part of Baqouba backed by helicopters and at least one jet. Sunni imams in four mosques used loudspeakers to call on their followers to fight the Americans, residents said by telephone.

Separately, the U.S. military said the most wanted Al Qaeda in Iraq figure south of Baghdad was killed last weekend by a precision-guided artillery round.

Abu Jurah, an Al-Qaeda cell leader, died Saturday in the Arab Jabour area just south of the city after U.S. troops received word that he and 14 others were meeting at a house there, a U.S. statement said.

In Baghdad, the deadliest bombing occurred when a suicide driver detonated his vehicle near an Iraqi army patrol in Zayouna, a mostly Shiite area of eastern Baghdad, killing 10 people, including six civilians, police said.

The blast near the Iranian Embassy occurred in late morning a few hundred yards north of the U.S.-controlled Green Zone, sending a huge cloud of black smoke over the city. Three civilians also were wounded, said police.

All the Baghdad police officers spoke on condition of anonymity because they were not authorized to release information.

Also Tuesday, the bodies of two security guards were found in the western Baghdad neighborhood of Mansour, two days after they were kidnapped from the office of a cell phone company where they worked, police said.

U.S. forces have launched offensives around the Iraqi capital to try to halt the flow of bombs and fighters into the city.

The U.S. command said American soldiers had killed about a dozen insurgents during a three-hour gunfight Monday in Fadhil, a Sunni enclave in the center of the city. The battle began when paratroopers from the 82nd Airborne Division came under fire from the Islamic Bank building, the military said.

One U.S. trooper was slightly wounded, the U.S. said.

U.S. Marines also have started a new offensive to establish a presence in towns along the Euphrates River long used as insurgent sanctuaries.

Operation Mawtini, begun Sunday, includes more than 9,000 U.S. and Iraqi troops and aims to establish control in remote areas of western Anbar province, the U.S. said.

The leader of the 30-member Sadrist bloc in parliament, Nasser al-Rubaie, said the decision to end the boycott was made after the government agreed to rebuild a Shiite mosque in Samarra which was destroyed in two bombings and to secure the highway from Baghdad and the shrine.

Pressure is now expected to mount on the Sunnis to end their boycott, which began over the ouster of the Sunni speaker of parliament last month. Sunni leaders say agreement is near on ending the protest.

Both protests have paralyzed work in Iraq's fractious, 275-member assembly as pressure is growing in the United States to bring an end to the U.S. military role here.

However, the Sadrists also oppose a number of bills sought by the government, including legislation to regulate the oil industry. That could make it tougher for key benchmark legislation to win approval.

Meanwhile, a group in Switzerland said nearly 2.2 million Iraqis are living in a precarious state of displacement inside Iraq, struggling to access regular food supplies or adequate shelter and health care.

About 60,000 additional Iraqis are being uprooted from their homes each month, spurred by sectarian violence, military operations and general lawlessness, said Jemini Pandya, a spokeswoman for the International Organization for Migration.

The 120-nation migration body has been distributing aid to hundreds of thousands of displaced and vulnerable Iraqis since the U.S.-led invasion of Iraq in 2003.

Pandya said it has become increasingly difficult to guarantee assistance for those most in need in Iraq, largely because of the insecurity in the country and limited resources for aid groups.

In Kirkuk, families collected the bodies of relatives from hospitals a day after a triple bombing killed about 80 people. Others were searching debris still left on the street, hoping for clues about what happened to friends and relatives whose bodies have not been identified.

All but one of the victims died when a massive truck bomb exploded near the Kirkuk Castle and the headquarters of the Patriotic Union of Kurdistan, the party of President Jalal Talabani.

It was the deadliest attack in Kirkuk, 180 miles north of Baghdad, where Arabs, Turkomen and Kurds are competing for control of the city at the heart of the northern oil region.

Separately, the U.S. military said a Marine died Monday in a non-combat related incident in Anbar province. No further details were released.

Complete coverage is available in FOXNews.com's Iraq Center.