But the violence hasn't stopped entirely. Four American soldiers were killed in combat yesterday in Baghdad. And today,, as CBS News chief foreign affairs correspondent Lara Logan reports.
It was a bloody stain on Iraq's day of celebration. Carnage followed a car bomb in a crowded outdoor market.
Once again innocent civilians shopping for the evening meal were targeted - this time mostly Kurds in the oil-rich city of Kirkuk, north of Baghdad.
Iraq's prime minister was in no mood to back down on the day his forces assumed control of the country's towns and cities from U.S. troops. He told the nation, "Those who think Iraqis are unable to defend their country are committing a fatal mistake."
That was clearly the message Maliki hoped to send with his new army's first parade: a flexing of Iraq's military muscle. The band played and tanks rolled by on the very same ground Saddam Hussein used to show his power.
But instead of the balcony where Iraq's former dictator so famously fired his rifle into the air, Iraq's leader chose a makeshift stand - as much due to security concerns as by design.
The parade avoided the famous crossed swords monument - so visible in parades of old. It's a symbol of Iraq's victory over Iran during the last war, now unpopular with the country's pro-Iranian government.
Prime Minister Maliki's grand parade could only be viewed in person by fellow members of his government and a handful of selected guests. No one else was allowed past the heavy security.
America's top general in Iraq, Raymond Odierno, was there to lend U.S. support. Some of his soldiers weren't allowed to carry their guns into the ceremony, turned back by Iraqi troops - a sign of how much the power has shifted.
"I think sometimes you have to give up some tactical risk for strategic gain and I think this is the case," Gen. Odierno said. "There might be still some little bit of tactical risk in some place but I believe it is well worth it for the strategic gain."
The strategic gain could easily be seen today - excitement on the streets of Baghdad as Iraqi forces took charge, U.S. troops nowhere in sight.
Even as Iraqis marked this milestone with pride, many were fearful of renewed violence and a government that has yet to prove it represents all of Iraq's people.