News of the ban came hours after a car bomb killed seven people and wounded dozens near Baghdad's most important Shiite shrine. Sunni extremists have staged attacks in the past during Shiite festivals, which have drawn huge crowds since the 2003 ouster of Saddam Hussein's Sunni-dominated regime.
It was the second vehicle ban in Baghdad this month in connection with Shiite rituals.
The latest ban was ordered to protect Shiite pilgrims traveling to Karbala, 50 miles south of Baghdad, to attend ceremonies marking the birthday of the "Hidden Imam," a 9th century religious figure who devout Shiites believe will return to Earth to usher in the rule of peace.
The festival reaches its high point Tuesday night and Wednesday morning.
The ban was widely expected even before Saturday's car bomb. It will cover all vehicles, motorcycles and bicycles as of 6 p.m. Saturday, the television quoted military spokesman Brig. Gen. Qassim al-Mousawi as saying.
Vehicles were banned in Baghdad from Aug. 8 through the morning of Aug. 11 during Shiite ceremonies honoring another Shiite saint, Imam Musa Kadhim, who is buried in the capital.
The noontime bombing in the Kazimiyah district of Baghdad occurred when a bomb hidden in a parked car exploded in busy Oruba Square about 500 yards from Imam Kadhim's tomb.
A medic at the local hospital said seven people were killed and 30 wounded, including two children.
Shop owner Hussein Abdul Rahman, who suffered minor shrapnel injuries, said the square was less crowded than usual because some many people had joined the pilgrimage to Karbala.
"Thank God — it could have been much worse than this," he said.
No group claimed responsibility, but suspicion fell on Sunni religious extremists who consider Shiites as heretics and collaborators with the Americans.
The U.S. command in Baghdad announced the grisly discovery of an execution site in the Arab Jabour area just south of the capital, a Sunni Arab area where al Qaeda in Iraq is known to operate.
During a 24-hour operation on Tuesday and Wednesday, soldiers found human skulls, decomposing bodies in a pit and bones wrapped in bloody clothes, U.S. spokesman Lt. Col. Christopher Garver said in a statement. Troops found blood spatter in a nearby building and other signs that executions had taken place there.
The troops took fire as they entered the area and shot back, killing one suspected terrorist, Garver said. Eight others were taken into custody, and the U.S. troops discovered homemade bombs and a weapons cache including trigger wires.
In a series of pre-dawn raids Saturday targeting al Qaeda in Iraq, U.S. forces killed three insurgent suspects and captured 17 others, Garver said.
Among those seized in an operation northeast of Samarra was a man who is suspected of providing money for weapons and other support to foreign fighters, and a suspected "associate" of senior al Qaeda leaders who had been sent to Beiji to set up operations there, he said.
In preparation for the ceremonies in Karbala, police asked hotel owners not to accept guests who have no passports or residency papers as protection against Sunni extremists infiltrating the crowds.
Police said vehicles would be banned from the city to prevent car bombings. Cordons of police checkpoints were being set up to protect the two major shrines that are the focal points of the ceremonies, said Raid Shakir Jawdat, Karbala's provincial police chief.